Why Carvana Is Soaring 23% Higher Today
Shares of Carvana (NYSE: CVNA), a used car e-commerce retailer, jumped over 23% Thursday afternoon after the company reported a mixed second-quarter result due to COVID-19 but also reported the strongest demand management has seen toward the end of the quarter.
Carvana reported a 25% increase in retail units sold, which drove revenue up 13% to $1.1 billion, compared to the prior year's second-quarter, checking in slightly below Wall Street's estimates. Carvana's bottom line checked in with a net loss of $0.62 per share, which was better than analysts' estimates calling for a $0.77 per share loss. While those top- and bottom-line results are important for investors, what's likely driving the stock higher today is a mix of historically strong demand for Carvana's vehicles at the end of the quarter and the belief that consumer car-buying habits have accelerated toward e-commerce due to COVID-19. "We've been leading the market with The New Way to Buy a Car™ for the last 7 years and now with even more customers moving to online buying, we are seeing more demand than ever before," said Ernie Garcia, founder and CEO of Carvana, in a press release.
Image source: Carvana.
Source Fool.com
