CVNA: Carvana Stock Pops on Upbeat Guidance

The online used-car dealer predicted a narrower loss, boosting investors’ confidence for the quarter.

• Carvana, Wall Street’s preferred used-car retailer, issued revised first-quarter guidance that forecasts an Ebitda loss in the range of $50mn to $100mn, compared to $348mn a year ago. Shares of the company advanced 6.3% during Wednesday’s session and were up in off-hours trading Thursday.
• More broadly, the company has thrown itself into a restructuring adventure with some $9bn debt load. Now, Carvana needs the support of its creditors to stay afloat when declining vehicle sales are threatening to upend its business model.
• Carvana rose to fame in 2021 when its valuation peaked at $50bn. Since then, shares have run out of fuel and are down about 98% amid changing market conditions and crushing debt. This year, though, its stock is up over 80% as enthusiastic buyers scooped up discounted shares.