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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Carvana Co. (XNYS:CVNA) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
CVNA
Name:
CARVANA CO. (XNYS:CVNA)
Sector:
- 813000.00K
Industry:
Internet Retail
CEO:
Mr. Ernest Garcia
Total Employees:
21,000
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -104.43% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF CARVANA CO.(CVNA) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND INTERNET RETAIL INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
31.58
One Month Price Target:
$32.04
Six Month Price Target :
$34.35
Likely Price in One Year's Time:
Ticker:
$37.11
Likely Trading Range Today Under (Normal Volatility)
$31.25
Price Upper limit ($) :
$31.94
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$27.38
This week:
$22.19
This month :
$12.8
Other Primary facts
Market Cap:
5.94B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
188.70M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
43.04%
-26.35%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$51.08
$42.18
$12.08
$20.98
Medium risk (<10%) entry points
Buy Call
Sell Call
$39.29
Buy Put:
Sell Put:
$37.39
$23.85
$25.77
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
CVNA
Sharpe Ratio:
0.55%
Comparison:
CVNA, is amongst the top 60% stocks with highest risk-adjusted returns
Sharpe ratio is -81.95% lower than the industry
& is -75.72% lower than the market/S&P 500 average
Average Returns/Yield of
CVNA
Daily returns:
0.04%
Weekly returns:
0.22%
Monthly returns:
0.90%
Yearly returns:
37.29%
Comparison of returns:
Average annual returns/yield (last 3 years) is -71.16% below industry average
Classification:
CVNA, is amongst the top 60% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.65
Statistical test of Returns:
CVNA has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
6.50%
Weekly Volatility:
14.53%
Monthly Volatility:
29.06%
Yearly Volatility:
100.66%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
1.74%
Volatility in last five trading days has been -73.17% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-13.30%
Weekly VaR:
-29.74%
Monthly VaR:
-59.48%
How Much Can the price of
CVNA
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-52%
Worst case (decline):
>85%
This translates to price declining to:
$15.13
This translates to price declining to:
$4.74
Severe Crash Probability
Risk of crash in next 6/12 months: Low (<25%)
What is Value at Risk (VaR)?
Risk Fundamentals
CVNA is a 319.80% riskier investment compared to the market/S&P 500 & is 259.64% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is 38.07% above industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
CVNA
Beta in relation to market/S&P 500--2.61
Expected beta in 1 year's time:
1.558
Expected beta in 3 year's time:
2.203
Unlevered (debt free) Beta:
0.054
Beta in relation to Nasdaq (XNAS):
2.105
Beta in relation to all global stocks::
1.389
Beta Comparison & Analysis
Beta of competitors/peers::
1.233
Beta is 111.58% higher than peers
Average Industry Beta:
2.105
Beta is 23.91% above industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
-
-
Alpha provided | Alpha Analysis
Alpha provided:
-0.103
Alpha is -152.03% below industry average alpha yield
Alpha is -653% below the market average
Analysis of Cost of Capital of
CVNA
Equity cost of capital:
0.210
Equity cost of capital is 19.62% above industry mean WACC
Unlevered (without debt) cost of capital:
0.44%
Before-tax cost of debt:
3.12%
After-tax cost of debt:
2.47%
Overall debt rating:
High AA grade (second highest grade)
Weighted average cost of capital (WACC):
2.47%
WACC is -56.46% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$74.54
Revenue growth rate per share of (3Y):
114.6
Annual revenue growth rate is -79.50% below industry average
EPS:
-$4.03
Expected Annual growth rate of EPS (3Y):
-12.70%
Expected future EPS growth rate is 234.01% higher than the Internet Retail industry
Free cash flow (FCF) per share:
-
Balance sheet equity growth per share: -100.00%
Equity growth rate per share is 388.02% higher than the industry
Debt per share
$19.93
EBITDA per share
-$0.15
Valuation Analysis Today of
CVNA
P/E Ratio:
0
P/E Ratio of Competitors/Peers:
46.26
P/E ratio is -100.00% lower than main peers & is higher than the industry
-
CVNA is -147.00% undervalued if valued using industry average P/E ratio
-
-
P/S (Price to Sales ratio):
0.42
Price to sales ratio is -79.31% below the industry mean
P/B (Price to book value ratio):
114.6
-
-
Net income growth rate (3Y):
-63.02%
Net income growth rate is -192.70% lower than the industry average net income growth rate
Dividend Analysis
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Dividend History:
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
4700.00%
Net debt to equity ratio:
8096.25%
Debt to assets ratio:
49.57%
Net debt to assets ratio:
85.39%
Debt-to-asset ratio is -24.42% below industry average
Ability to repay debt:
Interest coverage ratio:
-0.13
Interest coverage ratio is -101.28% less than industry average
Looking forward:
Debt growth rate:
0.00%
-
Debt repayment rate in last quarter: 54.67%
Analysis of Key Statistics
Correlation of price movement with the market:
0.523
Statistical significance of correlation:
CVNA has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.441
Stock price is 18.69% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.441
Correlation of price movement with Nasdaq (^IXIC):
-0.069
Covariance of price movement with the market:
-0.261
Kurtosis
7.432
Returns have a significant fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
1.082
Returns are right (positive) skewed; mean returns are greater than median and mode returns
Fundamental Analysis & Dupont Analysis of
CVNA
Gross Profit Margin Ratio:
54%
Operating Profit Margin Ratio:
-3.37%
Operating profit margin is -142.28% lower than the industry
Net Profit Margin Ratio:
54%
Effective Tax Rate:
-0.14%
Effective tax rate is -101.56% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
-448.75%
Return on equity (ROE) is -2378.50% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
-4.73%
Return on assets (ROA) is -260.60% lower than the industry
Financial Leverage:
2.0x
Current Ratio:
1.36
Current ratio is -31.95% below industry average
Cash Conversion Cycle (days):
31.9
Cash conversion cycle is -51.13% below industry average
The remaining useful life of property plant & equipment is: 8.4 years
Stock based compensation to net income ratio:
-7.80%
In-depth Efficiency Analysis
Revenue generated per employee:
669.8K
Each employee generates -12% less revenue than industry average revenue per employee
EBITDA generated per employee:
- 1.3K
Each employee generates -101% less EBITDA than industry average revenue per employee
Profit generated per employee:
- 17.1K
Each employee generates -110% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
- 38.7K
Each employee generates -2565% less free cash flow than industry average revenue per employee
Assets/Capital per employee
119.8K
Each employee generates -2565% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
CVNA
LAS VEGAS SANDS CORP. (XNYS:LVS)
APTIV PLC (XNYS:APTV)
CHIPOTLE MEXICAN GRILL, INC. (XNYS:CMG)
D.R. HORTON, INC. (XNYS:DHI)
YUM! BRANDS, INC. (XNYS:YUM)
Ferrari NV (XNYS:RACE)
V.F. CORPORATION (XNYS:VFC)
HILTON WORLDWIDE HOLDINGS INC. (XNYS:HLT)
AUTOZONE, INC. (XNYS:AZO)
Current Analyst Ratings
Strong buy�21%
Buy�21%
Hold�13%
Sell�4%
Strong sell�0%
Overall analyst sentiment is: Strong buy
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
14.07B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
12.18B
1.89B
-
1.83B
2.36B
534.00M
-
2.36B
-
210.00M
120.00M
- 28000.00K
- 474000.00K
- 359000.00K
- 710000.00K
1.00M
- 359000.00K
Statement of Cash Flow
Date:
Period:
37.00M
Differed Income Tax :
-
Stock Based Compensation :
28.00M
Change in Working Capital :
- 56000.00K
Accounts Receivables:
- 5000.00K
Other Working Capital:
-
Other Non-Cash Items:
- 96000.00K
Net Cash Provided by Operating Activities:
- 593000.00K
Investments in PP&E:
- 220000.00K
Net Acquisitions:
-
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
247.00M
-
247.00M
208.00M
3.30B
1.31B
5.07B
2.33B
9.00M
4.00M
-
-
171.00M
2.52B
-
7.59B
154.00M
2.96B
104.00M
37.00M
586.00M
3.74B
3.76B
32.00M
3.79B
-
7.53B
-
- 749000.00K
-
-
March 31, 2022 at 6:00:00 AM
14.54B
80.00M
7.61B
-
6.72B
6.5B
-
12.00M
- 208000.00K
- 4534000.00K
-
-
-
5.24B
707.00M
-
- 94000.00K
542.00M
636.00M
- 593000.00K
- 220000.00K
- 813000.00K
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
CVNA
2023
2024
2025
2026
2027
$37.23
$43.75
$51.42
$60.43
$71.02