Kevin Carter/Getty Images
Key Takeaways
- Carvana shares gained Thursday as analysts at Piper Sandler advised buying the dip in the company's stock after a recent selloff.
- Piper Sandler stated that the online used-car retailer could increase its market shares tenfold in the long run.
- Analysts suggested that Carvana was well-insulated from the effects of new tariffs.
Carvana shares (CVNA) rose Thursday after analysts at Piper Sandler recommended buying the dip in used car retailer Carvana’s stock following a recent drop.
Carvana stock has lost about a third of its market value since the company announced quarterly results in February. Piper Sandler’s analysts told their clients that they would “accumulate”, and reiterated the $225 price goal, implying a 20% gain from Thursday. Visible Alpha’s analysts have a consensus that is even higher at $287.
Piper Sander reported that the company currently holds a 1% share in the used-car market. Analysts expect this to grow to more than ten percent. They said Carvana’s sales could increase from 416,000 cars last year to more than 3 million over the long-term.
Piper Sander suggested that Carvana would be especially well-insulated from the impact new tariffs. Analysts say that’s partly because Carvana sells used cars primarily in the United States, but also because it has room to expand its sales, even if the used car market is struggling.
Carvana’s shares rose over 5% to close Thursday at $185.42. Despite the recent selloffs, the value of its shares has more than doubled over the last 12 months.
