‘Candy for Millennials’ Auto Stock Has Skyrocketed by 900% – CCN Markets
Carvana Corporation is all about making the experience of buying a used car fun. Buyers browse through the tech company’s selections online. Once approved for financing, users visit one of Carvana’s locations to pick up their vehicle. Before they can take their ride home, buyers have to insert an oversized coin into a slot and activate the car vending machine.
This video below shows the complete pick up experience:
The unique and interactive experience is attracting a lot of buyers. According to the Wall Street Journal, revenue grew from $859 million in 2017 to $1.955 billion in 2018.
The surge in sales have contributed to the stock’s growth from $8.14 in May 2017 to an all-time high of $84.60 in August 2019. That’s a meteoric rise of close to 940 percent in two years.
Even after an explosive growth, we think that the stock could have more gas in the tank.
Carvana’s (CVNA) Long-Term Uptrend Looks Strong
A quick look at the stock’s weekly chart and you’d easily notice that Carvana is in an unstoppable uptrend.
In August, the equity took out resistance of $72 with heavy volume. This triggered the breakout from a large cup and handle pattern on the weekly timeframe. The breakout pushed CVNA to an all-time high of $84.60. More importantly, the breakout signifies the resumption of the uptrend.
At this point, however, it would be wise to wait for the breakout rally to fade. Ideally, the stock corrects and converts $72 resistance into support. Should bulls seal the former resistance into support, we can expect Carvana to take out its all-time high.
Based on the height of the cup and handle pattern, the target of this bullish breakout is $96.
Analyst: It Is ‘Highly Probable’ for This Stock to Hit $100
“CVNA – cars sold like online vending machines – is candy for millennials. Basically, some folks don’t mind paying up for a better car buying experience and some investors think this could be a disruptive business model justifying its 3.5 times 2019 sales.”
On top of that, the analyst also gave her projections on the stock:
“Having said that, CVNA is falling into the 80-20 rule for technical traders. Once a stock hits $80, which CVNA has, it is highly probable it will hit $100.”
From the looks of it, Carvana is not yet done soaring.
Disclaimer: This article is intended for informational purposes only and should not be taken as investment advice.