Carvana (CVNA-N)

Up 160% in the past year. A fine operator. Always buy on dips.

Has fallen hard, but the new tariffs will be good for their business, driving people to buy used cars. A good CEO.

They were in trouble last year until they got big backing from creditors and reduced their debt. Is up 353% this year.

It is coming back as the used car market picks up. It is an interesting play but keep your position small. He doesn't have all the numbers on it so can't call it right now.

Moving up in a step pattern -- rallies, consolidates at the higher level, rallies, consolidates. A fantastic accumulation pattern, extremely well supported. Now consolidating. As long as it holds above $100 support, it's still being accumulated.

The 5-year chart is very interesting. Massive selloff, huge multi-year base, and now it's broken out. Looking at where it was, looks like it's just getting started longer term.

It reports Wednesday. The stock has a monster short position. There will be a short squeeze, leading shares up in another leg higher. Note that other used companies haven't done well.

One of the greatest, fastest turnaround stories he's seen. It's avoided bankruptcy, raised money and has bounced back.

No reflection on company fundamentals, but take some profits after its parabolic move.

It's run up lately, mostly due to a short squeeze. A good name, but wait for a pullback.

It got its groove Back. From mid-September till last week, shares were cut in half. The used car business is not the place to be when you're worried about interest rates. But shares are popping in the past week, partially due to a benign Fed/Powell meeting, and Carvana reported a stellar quarter last week. 

Is heavily shorted, but he keeps recommending it. Today, they announced earnings suddenly. Shares soared 40% today with a blowout quarter--record sales, a new deal to reduce debt by $1.2 billion, Q2 earnings beat on all lines. A great comeback story.

Shares are up 670% in the last 6 months, but do not short it.

CVNA has recovered quite well this year, after a substantial drawdown of around 90% from its peak in 2021 and it is now trading at 0.2x times' Price/Sales (as the company has negative EBITDA, earnings and even book value). Growth was more than 100% in COVID years but went substantially to even negative growth in recent quarters. The balance sheet is highly leveraged with $8.2B of net debt while still burning cash. Overall, the company was growing really fast in the COVID years, with the promise to become the leader of used cars. However, the company is still unprofitable, burning cash quite significantly, highly leveraged, and may need to raise additional capital in tough times. We consider the share price highly volatile, and we would prefer to wait until profitability has been achieved. The company came precariously close recently to going under, and the short position remains more than 50%. Too risky for us. 
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