Here's Why Carvana Investors Should Take a Cautious Approach
Embattled online auto dealership Carvana (US:CVNA) appears at first glance to have substantively turned a corner. On Thursday, management released better-than-expected guidance for the current second quarter of 2023. As a result, CVNA stock skyrocketed, surgingmore than 56%.
So far this year, shares have popped over 423%, delighting intrepid speculators. Nevertheless, prospective investors should check under the hood before signing on the dotted line.
To be sure, Tempe, Arizona-based Carvanas latest financial disclosure tempts at least further consideration. In its initiative to accelerate profitability, management now anticipates achieving adjusted EBITDA above $50 million in Q2. Just as importantly, non-GAAP total gross profit per unit (GPU) may top $6,000, representing a new company record. As well, such a tally would print a63%-plus improvement compared to the year-ago quarter.