Core Insights - Recurve Capital reported a strong performance in Q2 2025, achieving a gross return of +31%, significantly outperforming the S&P 500's +10.6% and the Nasdaq's +17.8% [1] - Year-to-date, the fund has returned +14.8% gross and +12% net [1] Company Highlights - Carvana Co. (NYSE:CVNA) was highlighted as a key stock in Recurve Capital's portfolio, with a one-month return of 6.63% and a remarkable 123.45% increase in value over the past 52 weeks [2] - As of October 2, 2025, Carvana's stock closed at $394.71 per share, with a market capitalization of $46.16 billion [2] - Carvana Co. was noted as the largest contributor to Recurve's performance year-to-date, indicating a strong position within the fund [3] - The company has been a long-term holding for Recurve, becoming its largest position, and the decision to retain this investment has been beneficial for performance [3]

Upgrades - Baird upgraded United Rentals (URI) to Outperform from Neutral with a price target of $1,050, up from $888, indicating stabilization in the rental industry after two years of deceleration [2] - Jefferies upgraded Sunrun (RUN) to Buy from Hold with a price target of $21, up from $11, expecting cash generation to materialize in the second half and strong growth through 2026 as U.S. Third-Party Owners gain market share [3] - HSBC upgraded Autodesk (ADSK) to Buy from Hold with a price target of $343, down from $388, noting Autodesk's potential to monetize artificial intelligence and likely margin expansion [4] - Jefferies upgraded Delta Air Lines (DAL) to Buy from Hold with a price target of $70, up from $62, citing a raised Q3 revenue outlook to 2%-4% from 0%-4% as a sign of confidence in topline growth for Q4 and 2026 [5] - Jefferies upgraded Carvana (CVNA) to Buy from Hold with a price target of $475, up from $385, based on consumer survey results and capacity analysis suggesting continued elevated growth [6] Downgrades - Northland double downgraded DraftKings (DKNG) to Underperform from Outperform with a price target of $33, down from $53, due to increasing headwinds from prediction markets [7] - RBC Capital downgraded GE Vernova (GEV) to Sector Perform from Outperform with a price target of $605, down from $631, as current valuations reflect strong demand and productivity improvements [7] - Evercore ISI downgraded Allstate (ALL) to In Line from Outperform with a price target of $233, up from $230, citing over-earning in auto insurance and limited scope for positive estimate revisions [7] - Goldman Sachs downgraded Doximity (DOCS) to Sell from Neutral with a price target of $64, up from $57, indicating the growth profile does not support the current valuation [7] - Goldman Sachs downgraded LivaNova (LIVN) to Neutral from Buy with a price target of $55, down from $56, due to decelerating sales growth and slowing margin expansion [7]

Core Insights - Carvana Co. (NYSE:CVNA) is recognized for its strong profitability outlook and is included in a list of stocks expected to double in value over the next five years [1] Group 1: Financial Performance and Market Position - Carvana's CEO, Ernest C. Garcia III, indirectly sold $3.73 million worth of Class A Common Stock at prices between $369.30 and $378.39, while retaining significant ownership through direct and trust-held shares [2] - Following an upgrade from JPMorgan, Carvana raised its price target to $425, supported by robust asset-backed securities markets, strong fundamentals, and solid second-quarter performance [3] - Despite facing challenges such as AI model proliferation, a partnership between Amazon and Hertz, an ongoing SEC investigation, and recent bankruptcy developments, Carvana continues to expand its market share, maintain capacity growth, and strengthen its balance sheet [3] Group 2: Business Operations - Carvana operates an online marketplace for buying and selling used automobiles in the U.S., offering a range of services including financing, logistics, vehicle acquisition, inspection, reconditioning, and customer support [4]

Core Insights - Major online used car vendors in India are preparing for potential stock listings that could raise over $1 billion combined [1][2] - Three unicorn startups, CARS24, CarDekho, and Spinny, are in early discussions with bankers to gauge investor interest and assess necessary restructuring for initial public offerings (IPOs) [2][3] - The companies aim to launch their IPOs within the next 12 to 18 months, although they have not yet engaged advisers for documentation [3] Industry Trends - The online used car marketplace is capitalizing on increasing investor interest in domestic-focused businesses in India, which has become the third busiest IPO market globally in 2025, raising over $10 billion through first-time share sales [4] - The pressure to streamline operations is evident as early investors push for profitability amid a tightening flow of private capital in the crowded second-hand car market [6] Company Developments - CARS24 has undergone significant operational changes, including job cuts and the closure of non-core ventures, to concentrate on its primary used-car marketplace [5][6] - CARS24 reported a loss of 5 billion rupees for the year ending March 2024 and had previously raised approximately $450 million at a valuation of $3.2 billion [7] - Competitor CarDekho has postponed its IPO plans and is merging its insurance arm with another company, while Spinny is also seeking fresh capital and slowing down expansion [7][8] Business Restructuring - Smaller rival Droom is refocusing on premium and luxury segments and is looking to refile IPO documents after significant revenue declines [9] - All mentioned companies, including CarDekho, Spinny, and Droom, reported losses for the year ending March 2024 [10] Market Performance - CarTrade Tech Ltd., the only publicly traded company in this sector, experienced a successful IPO in 2021 with demand exceeding 20 times the shares offered, and its stock has risen 63% this year, outperforming the NSE Nifty 50 Index [11]

Core Viewpoint - Carvana (NYSE:CVNA) shares have remained stagnant over the past six weeks, lacking catalysts to push the stock above $400, while recent developments may negatively impact the stock [4]. Group 1 - Carvana's stock price has been unable to gain momentum, remaining in a neutral position for an extended period [4]. - Recent developments, including the partnership between Amazon and Hertz, are expected to exert downward pressure on Carvana's stock [4].

Group 1 - Sands Capital Select Growth Strategy reported a strong quarterly performance with a return of 27.7% in Q2 2025, significantly outperforming the Russell 1000 Growth Index, which gained 17.8% [1] - The positive performance was attributed to factors such as muted inflation, strong corporate earnings, and improving sentiment around artificial intelligence and global trade [1] - The investor letter highlighted Carvana Co. (NYSE:CVNA) as a key stock, which has seen a one-month return of 1.62% and a remarkable 138.95% increase in value over the last 52 weeks, closing at $365.35 per share with a market capitalization of $42.727 billion on September 15, 2025 [2][3] Group 2 - Sands Capital Select Growth Strategy initiated positions in Carvana Co. (NYSE:CVNA) and Arthur J. Gallagher (AJG), indicating confidence in Carvana's ability to gain market share in the fragmented used-car market [3]

Core Insights - Optimist Fund achieved its strongest investment performance since inception, returning 39.2% in Q2 2025 compared to a benchmark return of 11.3% [1] - The fund focuses on investing in underappreciated, market-leading businesses led by ambitious CEOs with significant growth potential [1] Company Highlights: Carvana Co. (NYSE:CVNA) - Carvana Co. reported a 46% growth in retail units and a 38% increase in revenue, achieving an all-time high adjusted EBITDA margin of 11.5% [3] - The company has set a long-term target of 3 million annual retail units at a 13.5% EBITDA margin within 5-10 years, indicating a potential for over 40% annualized unit growth [3] - Carvana's stock closed at $365.35 on September 15, 2025, with a market capitalization of $42.727 billion, and has seen a 138.95% increase in value over the last 52 weeks [2][3] Investment Sentiment - Despite Carvana's strong performance, it is not among the 30 most popular stocks among hedge funds, with 91 hedge fund portfolios holding the stock at the end of Q2 2025 [4] - There is a belief that certain AI stocks may offer greater upside potential and carry less downside risk compared to Carvana [4]

Group 1 - Carvana Co. operates the leading ecommerce platform for buying and selling used cars in the US, leveraging significant efficiencies from nationwide scale [1] - The company has amassed significant scale, which contributes to its operational efficiencies [1] Group 2 - The investment philosophy focuses on identifying mispriced securities by understanding the drivers behind a company's financials, often revealed through a DCF model valuation [1] - This methodology allows for a flexible approach to investing, considering all prospects of a stock to determine risk-to-reward [1]

Company Overview - Proactive is a financial news publisher that provides fast, accessible, informative, and actionable business and finance news content to a global investment audience [2] - The company has a team of experienced and qualified news journalists who produce independent content [2] Market Focus - Proactive specializes in medium and small-cap markets while also covering blue-chip companies, commodities, and broader investment stories [3] - The news team delivers insights across various sectors including biotech and pharma, mining and natural resources, battery metals, oil and gas, crypto, and emerging digital and EV technologies [3] Technology Adoption - Proactive is recognized for its forward-looking approach and enthusiastic adoption of technology to enhance workflows [4] - The company utilizes automation and software tools, including generative AI, while ensuring that all content is edited and authored by humans [5]

Group 1 - Carvana is favored for long-term investment, with potential for a pullback to buy more shares at a discount [1][3] - The stock has shown strong performance recently, approaching its 2021 peak, and reached a new 52-week high before closing down slightly [1][2] - The company's recent earnings report exceeded Wall Street expectations, and management has set new long-term financial targets [2] Group 2 - Carvana's sales methodology is convenient, allowing customers to buy, sell, finance, and trade cars online, which positions the company to capture more market share in a fragmented auto sales space [2] - The stock is seen favorably by investors anticipating interest rate cuts, which would make financing easier [2] - Carvana's business model is considered best-in-class, with management on track for strong growth and rising profitability [3]