Carvana (CVNA) Second Quarter Profit and Sales Trump Estimates, View Up – August 6, 2021

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Carvana Co. (CVNA Free Report) posted earnings per share of 26 cents in the second quarter of 2021. Zacks’ consensus estimate was pegged at a loss of 37 cents. This is a milestone quarter for Carvana as it marks the first quarter of positive net income for the company. A higher than expected gross margin from all segments of the company contributed to this outperformance. Reported earnings also hovered around last year’s quarter loss of 62 cents per share.

In the second quarter, total revenue was $ 3,336 million, beating Zacks’ consensus estimate of $ 2,491 million. In addition, sales increased over sales of $ 1,118 million the previous year.

In the end of June quarter, the number of used vehicles sold to private customers jumped 95.7% to 107,815 from 55,098 the previous year. Total gross profit was $ 552 million, up 268% year-over-year. Selling and administrative expenses were $ 470 million, up 96.7% year over year.

Segment performances

Used vehicle sales totaled $ 2,504 million in the second quarter, soaring 152.4% year over year. Revenue also exceeded Zacks’ consensus estimate of $ 2,108 million. Used vehicles gross margin was $ 218 million, a significant increase of 230.3% year over year. Additionally, the reported figure exceeded Zacks’ consensus estimate of $ 155 million.

For the reported quarter, wholesale vehicle sales were $ 557 million, up 1,036.7% year-over-year. The figure also broke the consensus mark of $ 239 million. Gross profit from wholesale vehicle sales was $ 59 million, up 742.9% year-over-year. The measure also broke the consensus mark of $ 21 million.

For the April to June period, other sales and revenue increased 257.1% year-on-year to $ 275 million. The figure also exceeded Zacks’ consensus estimate of $ 217 million. Gross profit was $ 275 million, up from $ 77 million a year ago. Additionally, the metric topped Zacks’ consensus estimate of $ 192 million.

Financial situation

Notably, the company had cash and cash equivalents of $ 201 million as at June 30, 2021, compared to $ 246.3 million as at June 30, 2020. Long-term debt stood at $ 2,327 million. dollars as of June 30, 2021, compared to $ 965.7 million. million recorded as of June 30, 2020.

Carvana currently wears a Zacks Rank # 3 (Hold). You can see The full list of today’s Zacks # 1 Rank (Strong Buy) stocks here.

Outlook

In light of the record gross profit per unit and record EBITDA margin generated by Carvana – which shares space with TrueCar Inc. (TRUE Free report), CarGurus, Inc. (CARG Free report) and Vroum, Inc. (VRM Free Report) – In the second quarter, management expects robust growth throughout this year. The company estimates gross profit per unit to be over $ 4,000 in 2021, well above the earlier outlook of $ 3,000 and above the $ 3,252 recorded in 2020.

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