CARVANA CO (NYSE:CVNA) is a candidate for high growth investors. Here's why.

A possible breakout setup was detected on CARVANA CO (NYSE:CVNA) by our stockscreener. A breakout pattern is formed when a stock consolidates after a strong rise up. We note that this pattern is detected purely based on technical analysis and whether the breakout actually materializes remains to be seen. It could be interesting to keep an eye on NYSE:CVNA.

Analyzing the Technical Aspects

At ChartMill, a crucial aspect of their analysis is the assignment of a Technical Rating to each stock. This rating, ranging from 0 to 10, is calculated daily by considering numerous technical indicators and properties.

Overall CVNA gets a technical rating of 10 out of 10. This is due to a consistent performance in both the short and longer term time frames. Also compared to the overall market, CVNA is showing a nice and steady performance.

• The long and short term trends are both positive. This is looking good!
• Looking at the yearly performance, CVNA did better than 99% of all other stocks. We also observe that the gains produced by CVNA over the past year are nicely spread over this period.
• CVNA is part of the Specialty Retail industry. There are 123 other stocks in this industry. CVNA outperforms 99% of them.
• CVNA is currently trading near its 52 week high, which is a good sign. The S&P500 Index however is also trading near new highs, which makes the performance in line with the market.
• In the last month CVNA has a been trading in the 188.29 - 259.39 range, which is quite wide. It is currently trading near the high of this range.

Check the latest full technical report of CVNA for a complete technical analysis.

How does the Setup look for NYSE:CVNA

In addition to the Technical Rating, ChartMill provides a Setup Rating for each stock. This rating, ranging from 0 to 10, assesses the extent of consolidation in the stock based on multiple short-term technical indicators. Currently, NYSE:CVNA has a 7 as its setup rating:

Besides having an excellent technical rating, CVNA also presents a decent setup pattern. Prices have been consolidating lately and the volatility has been reduced. A pullback is taking place, which may present a nice opportunity for an entry. There is very little resistance above the current price. There is a support zone below the current price at 240.43, a Stop Loss order could be placed below this zone.

Why NYSE:CVNA may be interesting for high growth investors.

• CARVANA CO has demonstrated consistent growth in its earnings per share (EPS) from one quarter to another (Q2Q), with a 239.0% increase. This indicates improving financial performance and the company's effective management of its operations.
• CARVANA CO has demonstrated strong quarter-to-quarter (Q2Q) revenue growth of 31.81%, reflecting its ability to generate consistent increases in sales. This growth highlights the company's effective market positioning and its potential for continued success.
• CARVANA CO has seen a 125.0% change in the average next Quarter EPS Estimate by analysts over the last 3 months, signaling the shifting perception of the company's EPS outlook.
• In the most recent financial report, CARVANA CO reported a 239.0% increase in quarterly earnings compared to the previous quarter. This notable growth indicates positive momentum in the company's financials, suggesting an upward trend
• The earnings per share (EPS) growth of CARVANA CO are accelerating: the current Q2Q growth of 239.0% is above the previous year Q2Q growth of 82.77%. Earnings momentum and acceleration are key for high growth systems.
• With positive growth in its operating margin over the past year, CARVANA CO showcases its ability to improve profitability through effective cost control and operational efficiency. This growth underscores the company's commitment to enhancing its financial performance.
• The free cash flow (FCF) of CARVANA CO has seen steady growth over the past year, indicating enhanced cash flow generation and financial health. This trend underscores the company's effective capital management and its ability to generate sustainable cash flows.
• CARVANA CO exhibits a favorable ownership structure, with an institutional shareholder ownership of 55.88%. This signifies a diverse investor base, which can contribute to a more stable and efficient market for the stock.
• With a track record of beating EPS estimates 3 times in the last 4 quarters, CARVANA CO showcases its consistent ability to deliver earnings surprises. This reflects the company's strong execution and its competitive position in the market.
• The Relative Strength (RS) of CARVANA CO has consistently been strong, with a current 99.6 rating. This indicates the stock's ability to exhibit relative price outperformance and reflects its competitive strength. CARVANA CO demonstrates promising potential for sustained price momentum.

More ideas for high growth momentum breakouts can be found on ChartMill in our High Growth Momentum Breakout screen.

Keep in mind

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.