Carvana (NYSE:CVNA) stock is sliding lower on Friday after the used-car retailer’s shares were downgraded by Piper Sandler.
That downgrade has analyst Alexander Potter dropping shares of CVNA stock from an “overweight” rating to a “neutral” rating. For the record, the analyst consensus rating for shares is a “reduce” rating based on 21 opinions.
Despite the downgrade, Potter did raise his price target for CVNA stock from $29 per share to $48. That represents a potential 2.7% upside from its prior closing price yesterday. For comparison, the analyst consensus price prediction for CVNA stock is $40.83 per share.
What’s Behind the New CVNA Stock Rating
Here’s what Potter said about CVNA stock in a note to clients obtained by CNBC:
“We upgraded CVNA last September on the basis the company was trading at a significant discount to intrinsic value due to bankruptcy risk — which we thought was unlikely. Now that the bankruptcy scare has abated, and the stock has risen to $47, we believe CVNA is approaching a fair valuation […] Chasing the stock higher would necessitate an upward revision to CVNA’s long-term used vehicle market share expectations, which we do not believe recent results substantiate.”
CVNA stock is down 1.2% as of Friday morning but is up 909.3% year-to-date (YTD) as of yesterday’s close.
Investors looking for even more of the most recent stock market news will want to keep reading!
We have all of the hottest stock market stories that traders need to know about on Friday! Among that is what’s moving shares of Kiora Pharmaceuticals (NASDAQ:KPRX) stock, Sigma Additive Solutions (NASDAQ:SASI) stock and Digital World Acquisition (NASDAQ:DWAC) stock today. All of that news is ready to go at the links below!
More Stock Market News For Friday
- Why Is Kiora Pharmaceuticals (KPRX) Stock Down 7% Today?
- Why Is Sigma Additive Solutions (SASI) Stock Down 40% Today?
- Why Is Digital World Acquisition (DWAC) Stock Up 20% Today?
On the date of publication, William White did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
