Carvana’s stock is sometimes up, sometimes down, always volatile
Shares in online car seller Carvana surged some 34% yesterday, continuing their recent resurgence. That rebound has made the father-son duo behind the company some $11B since late 2022 — a period when the stock was dropping as much as 40% in a single day, and was teetering on the verge of insolvency as creditors explored options to restructure its debt.
Since then the company, famous for its “car vending machines”, has seen its fortunes reverse, as the used-car market has stabilized and sales have returned to growth (up 17% in Q1 2024). Most importantly, however, Carvana seems to have gotten a handle on its massive $5B+ debt load — which was a major factor in why the equity in the company was so volatile — after swinging into profitable territory in Q1.
Yesterday’s move leaves the stock up more than 16x in the last 12 months.
Since then the company, famous for its “car vending machines”, has seen its fortunes reverse, as the used-car market has stabilized and sales have returned to growth (up 17% in Q1 2024). Most importantly, however, Carvana seems to have gotten a handle on its massive $5B+ debt load — which was a major factor in why the equity in the company was so volatile — after swinging into profitable territory in Q1.
Yesterday’s move leaves the stock up more than 16x in the last 12 months.
