Carvana (CVNA): Strong Q4 Results, Stock Drops 10.8%
Carvana (NYSE: CVNA), an online used car dealer, reported revenue in Q4 CY2024 that exceeded Wall Street expectations. Sales surged 46.3% year over year to $3.55 billion.
Q4 CY2024 Highlights:
* Revenue: $3.55 billion (46.3% YoY growth, 6.2% beat)
* Adjusted EBITDA: $359 million (10.1% margin, 8% beat)
* Retail Units Sold: 114,379
* Market Capitalization: $34.43 billion
Company Overview:
Carvana's innovative car vending machines and online platform offer a convenient automotive shopping experience for buying and selling used cars.
Ecommerce Adoption:
Carvana benefits from the secular trend of increased ecommerce adoption. In 2020, ecommerce penetration grew by 5%, reaching 25% as consumers shifted to online shopping. This trend has further fueled the growth of online retailers like Carvana.
Sales Growth:
Over the past three years, Carvana's sales have grown at a 2.2% CAGR. However, this quarter's revenue growth of 46.3% exceeded expectations. Sell-side analysts forecast further growth of 15.3% over the next 12 months.
Key Takeaways from Q4 Results:
* Carvana exceeded EBITDA expectations by a significant margin.
* Revenue outperformed Wall Street estimates, indicating strong demand for used vehicles.
Market Reaction:
Despite the strong results, Carvana's stock price dropped 10.8% to $251.25 immediately following the report. This may be attributed to high market expectations.