CVNA Stock On Track For Best Day In Nearly 14 Months As Morgan Stanley Terms It Top Pick On ‘Strong’ Q3 Report

• Bank of America analyst Michael McGovern noted that Carvana is executing well in a mixed macro environment, with better reconditioning efficiency helping offset margin pressure from financing and rising advertising spend.
• BTIG, however, noted heavier-than-expected expenses in vehicle operations, overhead, and advertising.
• Needham lowered its price target on the stock but still views the shares as a compelling large-cap growth story.

Shares of Carvana Co. (CVNA) jumped roughly 16% on Thursday following the company’s third-quarter earnings report, which Morgan Stanley hailed as “strong” while moving the stock into its top picks.

The stock is now on track for its best day since late July 2025, if the gains hold.  

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CVNA Reports Record Q3

The used car retailer sold a record 217,385 retail units in the quarter ended September 30, up 39% year over year, driving revenue of $8.04 billion, also a record and up 42%. Adjusted core profit hit a record $800 million, though earnings of $0.39 per share missed the Street’s estimate of around $0.44, partly reflecting a one-time debt-related charge and margin pressure from financing and higher costs.

Management guided for sequential unit growth in the fourth quarter and full-year 2026 adjusted core profit toward the high end of its $2.7–$3.0 billion range.

Morgan Stanley Moves CVNA To Top Pick

Morgan Stanley analyst Andrew Percoco elevated Carvana to the firm’s Top Pick after the “strong” print. The decision rested less on near-term estimate tweaks and more on greater conviction that the business model can compound profits through macroeconomic volatility. The firm kept its $88 price target and 'Overweight' rating on the stock.

Other Analyst Reactions To CVNA

Meanwhile, Bank of America analyst Michael McGovern raised his price target to $72 from $70 while maintaining a 'Neutral' rating. He noted that Carvana is executing well in a mixed macro environment, with better reconditioning efficiency helping offset margin pressure from financing and rising advertising spend.

BTIG, however,  trimmed its target to $82 from $87 and kept a 'Buy' rating, citing a solid beat across major metrics but heavier-than-expected expenses in vehicle operations, overhead, and advertising.

Needham lowered its target to $100 from $120 while retaining a 'Buy.' The firm still views the shares as a compelling large-cap growth story, with durable market-share gains supporting unit and earnings expansion, though the lower target reflects a reduced earnings multiple amid higher interest rates.

How Did CVNA Retail Traders React?

On Stocktwits, retail sentiment around CVNA stock stayed within the 'bullish' territory over the past 24 hours, while message volume rose sharply by about 675%.

CVNA stock is down 19% year-to-date. 

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