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Tag: CVNA stock price

  • What Is Setting Carvana (CVNA) Stock Higher Today?

    Carvana Co. (NYSE: CVNA) is soaring 34.83% in early Wednesday trading, a remarkable increase of $13.86 from the previous closing price. The surge was fueled by a recent debt restructuring agreement and record-breaking financials.

    Which Deal Has CVNA Entered Into?

    Carvana (CVNA), the renowned used-car retailer, made a significant announcement on Wednesday, revealing a groundbreaking agreement that will have a profound impact on its financial standing.

    By signing an agreement with a group of noteholders, Carvana is set to reduce its total outstanding debt by an impressive sum of over $1.2 billion.

    This news sent waves of positivity throughout the market, resulting in a remarkable 31% surge in the company’s shares during premarket trading.

    The agreement itself is nothing short of remarkable. It aims to eliminate a staggering 83% of Carvana’s unsecured notes that were scheduled to mature in 2025 and 2027.

    This strategic move will also lead to a substantial reduction in required cash interest expenses, with savings exceeding $430 million per year for the next two years.

    CVNA Reported Q2 2023 Financials

    The second quarter of 2023 proved to be a remarkable period for Carvana, as the company achieved record-breaking financial results.

    The total gross profit per unit, referred to as GPU, reached an impressive $6,520, marking a remarkable increase of 94% compared to the second quarter of 2022. This remarkable achievement surpassed the company’s previous best quarter by a notable margin of 27%.

    In the past 12 months, Carvana has also made impressive strides in cost reduction, achieving over $1.1 billion in annualized cost reductions.

    These accomplishments, combined with the generation of $2.968 billion in revenue from the sale of 76,530 retail units, reflect Carvana’s exceptional performance and resilience in the market.

    How CVNA Will Excel Further?

    The remarkable execution and impressive financial results by Carvana (CVNA) during the second quarter have undeniably set the stage for future success.

    The company’s focus on achieving its three-step plan and returning to a path of sustainable growth has made the business fundamentally stronger. With its strong performance and strategic initiatives, CVNA is positioned for a promising future in the automotive retail industry.

  • Carvana Co. (CVNA) stock declined in the after-hours; here is why?

    Carvana Co. (CVNA) stock declined in the after-hours; here is why?

    Carvana Co. (CVNA) declined in the after-market after announcing to acquire ADESA for $2.2 billion in cash. CVNA values at $120, losing more than 4% compared to yesterday’s closing price. The stock closed at $126.05 at the end of the last trading session. The stock volume traded in the last trading session was around 3.6 million shares. The current market cap of the company is around $21.78 billion.

    CVNA acquired ADESA

    Carvana Co. (CVNA) has agreed to buy ADESA’s US physical auction business for $2.2 billion in cash. ADESA US has 56 facilities and roughly 4,500 corporate and operational employees. In 2021, ADESA’s US company processed over a million transactions on these 4,000-acre properties with 6.5 million square feet of structures.

    The combined company would provide considerable infrastructure and team to extend and improve Carvana’s customer offering with a broader variety of automobiles and quicker delivery times.

    The two companies, Carvana and ADESA US, significantly relate and complement each other. ADESA US’s reconditioning plants can add about 2M units per year to Carvana’s yearly output. With ADESA US and current Carvana inspection and reconditioning centers within 100 miles of most Americans, buyers will have exposure to more automobiles.

    Carvana has secured committed debt financing of up to $3.275 billion from JPMorgan Chase Bank NA and Citigroup Inc. They will also get $1 billion through debt financing for further improvements across the 56 sites. Carvana’s financial advisors are Citi and J.P Morgan. Its legal advisors are Kirkland & Ellis LLP.

    CVNA CEO’ Remarks

    Founder and CEO Ernie Garcia said that the company is happy that ADESA USA has joined Carvana. A nationwide infrastructure network and a wealthy business will help Carvana become the largest and most successful vehicle reseller. We will be able to give our retail customers more selection, value, and delivery times, while simultaneously raising the bar for our wholesale clients.

    Conclusion

    The company had announced 125% in the 3rd quarter of 2021. The company has yet to announce its fourth quarter and fiscal 2021 results. The acquisition in cash shows the company has a strong balance sheet and is moving forward to grow the company.