Three Most Whopping Promising Performer Stocks of 2020

Carvana Surges as Q3 Earnings Report Smashes Wall Street Estimates

On Wednesday, Carvana shares soared following a third-quarter earnings report that obliterated Wall Street projections and set multiple record highs.

The Arizona-headquartered firm’s stock slid by 0.69% to $207.31 apiece on October 30 but rebounded by a staggering 20.11% after hours to $248.99. Analysts anticipate the bullish momentum to continue with a 1.43% rise to $252.55 per share in the coming market.

In the September quarter, Carvana posted adjusted earnings per share (EPS) of $0.64, more than double the Wall Street consensus of $0.29. This reading also represented a more than quadruple quarter-over-quarter (QoQ) growth from $0.14 in the third quarter.

Meanwhile, revenues of $3.66 billion moderately surpassed analysts’ expectations of $3.45 billion. The figure also marked a sizable QoQ jump from $3.41 billion in the same period last year.

Carvana delivered adjusted Q3 earnings before interest, taxes, depreciation, and amortization (EBITDA) of $429.00 million, crushing predictions of $335.80 million. Moreover, this pointed to a near three-fold climb from $148.00 million in last year’s July-September period.

A 34.00% year-over-year (YoY) increase in retail volumes to 108,651 vehicles served as the primary driver for the upbeat performance. This exceeded Wall Street’s expected recovery of 32.00% and ended two consecutive years of decline.

Wall Street Sees Record-Breaking Year for Carvana

For the full year, Carvana now targets an adjusted EBITDA of $1.20 billion, blazing past the Wall Street projection of $1.10 billion. If realized, this would indicate a remarkable annualized increase of 253.98% from $339.00 million in 2023.

Market watchers reiterated that the used car retailer’s Q3 figures were miles above this year’s industry numbers. The company’s stock is up an impressive 291.59% year-to-date (YTD) and an even more stunning 697.65% YoY.

In comparison, shares of brick-and-mortar rival CarMax are down 3.51% YTD, while sporting a 20.43% YoY increase. Meanwhile, Carvana’s new car-selling counterpart, AutoNation, suffered a sharper-than-expected earnings decline of 27.00%.

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