Why Carvana Stock Tumbled Today

Core Viewpoint - Carvana's shares declined by 9.6% following a strong third-quarter earnings report due to disappointing fourth-quarter guidance and rising concerns in the auto industry [1][5][6] Financial Performance - Carvana reported a 44% increase in retail units sold, totaling 155,942, and a 55% rise in revenue to $5.65 billion, surpassing estimates of $5.1 billion [3] - Adjusted EBITDA increased from $429 million to $637 million, with earnings per share rising from $0.64 to $1.03, and adjusted earnings per share reaching $1.50, exceeding the consensus of $1.32 [4] Future Outlook - For the current quarter, Carvana anticipates retail units sold to be 150,000 or more and adjusted EBITDA to exceed the previous range of $2 billion to $2.2 billion, raising concerns about potential sequential declines in vehicle sales [5][8] - Despite strong growth, the stock is considered expensive, with high expectations already factored in [6]