Carvana's Second-Quarter Highlights and Why Its Acquisition Is a Big Deal
It's been a wild ride for early Carvana (NYSE: CVNA) investors, with its recent initial public offering (IPO) followed in short order by its first earnings report and even a surprise acquisition. Despite the optimism and excitement, the company's mission is no small task: It hopes to change the way people buy cars by removing traditional dealership infrastructure and replacing it with a unique vending machine or online purchase with a fully transactional website and delivery option. So far, it's impressed investors with early results; let's dig into the second-quarter data and see what to expect from Carvana's recently announced acquisition of Carlypso.
As expected with young growth companies, Carvana's revenue continues to soar. The company reported record revenue of $209 million during the second quarter, which was a staggering 142% increase over the prior year. Retail units drove revenue higher, with Carvana recording a 145% increase in units sold to 10,682. Total gross profit checked in at $16 million, a sizable increase of 166%, and even better yet, its total gross profit per unit jumped to $1,501, a $332 increase over the first quarter of 2017. But with rapid growth comes rising costs, and the company's ambitious expansion into seven new markets increased its net loss by 115% to $38.9 million, or $0.28 per share.
Carvana's Houston vehicle vending machine.
Source: Fool.com
Carvana Co. Stock
Currently there is a rather negative sentiment for Carvana Co. with 3 Buy predictions and 7 Sell predictions..
The target price of 33 € compared with the current price of 111.88 € for the stock indicates a negative potential of -70.5%.
