Is Carvana going to go bankrupt ?
How is their model even sustainable?
It isn’t.. they are running out of cash
There was this guy who sold a 2010 Nissan with 50000 miles on it to caravan for 25000, no inspection. I’m surprised they haven’t collapsed sooner
I added some shorts to the stock the last few days I’m just scared of potential mega squeeze lol
We’ll see. Bill & Melinda Gates Foundation purchased 500k stocks of Carvana and 2.5M stocks of Vroom.
Unlikely. You don’t want to bet against Ernie Senior. I wouldn’t touch shorts right now, you’re gonna get squeezed like a mofo.
IF Carvana can show cash flow neutral in a time when the used car market is complete shit. You'll see the stock turn and talk of bankruptcy go away. From an internal perspective changes are happening I've not seen before to lean and cut costs. The expectation coming out of 2020 was that Carvana was going to sell a million cars, that's why people were getting ridiculous prices for their sell to Carvana cars, we just needed inventory. Then the market tanked and all these cars Carvana bought at inflated prices being sold at a loss, plus the headcount to manage selling 1 million cars is what started this spiral. The big questions to answer are, can Carvana right the ship, or will the used car market turn around before Carvana burns through all their cash? I'm betting yes, just based on what I've seen but that's just me.
It might, but growth will still stagnate if they manage to survive still. Their business model is easy to implement, lots of copycats already trying and there’s nothing new or disruptive about Carvana. I guess time will tell. But still, no inmovation on the horizon
I'm not sure I agree and I understand being in it I might have a different perspective. But I believe Carvana has an opportunity no other used car dealer has. First selling online gets you access to unlimited variety brick and mortar places just can't compete with. Also bring a financing company, they have the ability to drive new sales. Whereas a normal car dealership sells you a car and that's it Carvana can initiate sales and present you with new financing terms. Also with the acquisition of ADESA Carvana has access to an amount of inventory no other used car dealer has. Essentially they can get first pick of whatever cars they want and undercut the competition by owning the auction house, then turn around and sell the car on the auction house if it doesn't sell via the website. So Carvana can select the cars in the highest demand with the best margins and insure they have them and prevent competitors from getting stock to compete. The potential to own market share is huge, they're already the #2 used car dealer in America, and have constantly grown and gained market share while CarMax (#1) hasn't grown at all or hardly grown in the same number of years. Albeit at the expense of heavy debt, which is what cause of all the issues now.
Holding the bag on thousands of rapidly depreciating assets with terrible opex
Just trying to play contrarian.. say they restructure debt and take write off for under water assets. If they were making smarter acquisitions is there any chance to ever achieve profitability or is the model just too expense heavy ?
Probably but on whatever margins used car dealers are making. Carvana’s model just isn’t that special imo