- Carvana’s (CVNA) stock rose over 4% to $222.68 after Morgan Stanley’s (MS) Adam Jonas upgraded it to ‘Buy’ from ‘Hold,’ lifting his price target to $280 from $260, citing a recent 12% drop from its $285 peak in mid-February as a prime buying opportunity.
- Despite a 450% gain over the prior 12 months before its February 19 earnings beat, Jonas sees Carvana’s pullback as a chance to invest in a leader in online used-car sales and fleet fulfillment, building on his earlier shift from ‘Sell’ to ‘Hold’ in November with a target jump from $110 to $260.
Carvana (CVNA), a major player in the used-car market, saw its shares climb over 4% to $222.68 during midday trading on Tuesday, spurred by a fresh upgrade from Morgan Stanley (MS) analyst Adam Jonas, who shifted his stance to ‘Buy’ from ‘Hold’ and nudged his price target up to $280 from $260. This boost comes after a rocky patch for the stock, which had soared to above $285 in mid-February before tumbling more than 12% following the company’s fourth-quarter earnings report on February 19. Despite the earnings beating Wall Street’s expectations, the stock’s incredible 450% surge over the previous 12 months appeared to lose momentum, creating what Jonas now sees as a golden window for investors to jump in.
Jonas, who’s been tracking Carvana’s wild ride, previously upgraded the stock in early November from ‘Sell’ to ‘Hold,’ raising his target from $110 to $260 as the company’s fortunes turned. He views Carvana as a standout in auto retail and fleet fulfillment – essentially, getting cars to buyers efficiently – and believes the recent dip is less about weakness and more about market dynamics offering ‘a unique’ buying opportunity. The company’s ability to exceed earnings forecasts highlights its operational strength, even as the stock’s earlier rally cooled off. Carvana has pivoted from near-collapse a couple of years ago to a leaner, more focused outfit, leveraging its online platform to streamline used-car sales in a way traditional dealerships often can’t match.
This upgrade reflects broader confidence in Carvana’s business model, which cuts out the middleman and lets customers buy cars from their couches, a trend that’s gained traction as digital commerce grows. With Jonas setting a $280 target, he’s betting the stock has room to run, driven by Carvana’s knack for adapting to a shifting industry. Investors seem to agree, pushing shares higher as they eye the potential for this once-troubled retailer to solidify its spot as a leader in the used-car space.
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