What Drove Carvana 14% Higher Tuesday?
Only small announcements were released about Carvana today, but here's what investors should focus on.
What happened?
Shares of Carvana (NYSE:CVNA), an e-commerce automotive vehicle-purchasing platform that offers as-soon-as-next-day delivery or pickup for consumers, popped 14% Tuesday despite no major development, although there were a couple of small announcements to note.
So what
The first bit of news was Carvana's launch in Arizona, expanding the company's footprint to three markets in the state. Thanks to today's launch, which hits closer to home for the company, Carvana now serves as-soon-as-next-day delivery in 101 markets across the U.S.
"Growing our presence in our home state is meaningful," said Ernie Garcia, founder and CEO of Carvana, in a press release. "We look forward to bringing Prescott the new way to buy a car and all of the convenience and selection that offers area car buyers."
One of Carvana's vending machines. Image source: Carvana.
Another small bit of news was a disclosure that HAP Trading LLC purchased 169,638 shares of stock valued at roughly $5.5 million, which isn't a large enough sum to move the needle for the stock.
Check out the latest earnings call transcript for Carvana.
Now what
We might file this under "sometimes stocks go up, and sometimes stocks go down." It's also possible that a positive development behind the scenes will eventually make its way out into the public media domain. Regardless of today's pop, the main focus for investors hasn't changed a bit: growth! And Carvana has delivered on that, with retail units and revenue jumping 105% and 121%, respectively, during the fourth quarter. It was the company's 20th consecutive quarter of triple-digit unit and revenue growth, and Carvana remains the fastest-growing public auto retailer in the country. Management is confident the company can reach selling 2 million cars annually, which would be phenomenal growth from 94,108 units sold in 2018.