Carvana falls as rising rates, inflation cut used car sales
Shares of upstart used-vehicle chain Carvana have tumbled further due to the company's struggles with falling prices and waning demand for its products
DETROIT (AP) — Shares of upstart used-vehicle chain Carvana tumbled another 16% Monday, undercut by the company's struggles with falling prices and waning demand for its products.
The latest downturn comes after the shares fell almost 40% on Friday following Morgan Stanley analyst Adam Jonas's move to suspend his rating and price target for the company's stock.
Carvana had been growing quickly as used car prices soared after the pandemic. But it has been caught in an environment where rising interest rates and high prices have sent many potential used car buyers to the sidelines. It reported a $283 million third-quarter net loss Thursday,
Jonas wrote in a note to investors Friday that Carvana's earnings revealed falling sales, higher expenses per vehicle sold, and a “material exhaustion" of cash.
