Overall CVNA gets a fundamental rating of 5 out of 10. We evaluated CVNA against 121 industry peers in the Specialty Retail industry. CVNA has only an average score on both its financial health and profitability. CVNA is valued quite expensively, but it does show have an excellent growth rating. These ratings would make CVNA suitable for growth investing!

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

CVNA had positive earnings in the past year.
In the past year CVNA had a positive cash flow from operations.
The reported net income has been mixed in the past 5 years: CVNA reported negative net income in multiple years.
The reported operating cash flow has been mixed in the past 5 years: CVNA reported negative operating cash flow in multiple years.

1.2 Ratios

CVNA's Return On Assets of 6.38% is fine compared to the rest of the industry. CVNA outperforms 75.21% of its industry peers.
CVNA has a better Return On Equity (27.60%) than 86.78% of its industry peers.
With an excellent Return On Invested Capital value of 17.57%, CVNA belongs to the best of the industry, outperforming 85.95% of the companies in the same industry.

		Industry Rank	Sector Rank
ROA	6.38%
ROE	27.6%
ROIC	17.57%

ROA(3y)-3.14%

ROA(5y)-3.39%

ROE(3y)N/A

ROE(5y)N/A

ROIC(3y)N/A

ROIC(5y)N/A

1.3 Margins

With a decent Profit Margin value of 3.44%, CVNA is doing good in the industry, outperforming 71.07% of the companies in the same industry.
With an excellent Operating Margin value of 9.40%, CVNA belongs to the best of the industry, outperforming 80.99% of the companies in the same industry.
Looking at the Gross Margin, with a value of 21.37%, CVNA is doing worse than 79.34% of the companies in the same industry.
In the last couple of years the Gross Margin of CVNA has grown nicely.

		Industry Rank	Sector Rank
OM	9.4%
PM (TTM)	3.44%
GM	21.37%

OM growth 3YN/A

OM growth 5YN/A

PM growth 3YN/A

PM growth 5YN/A

GM growth 3Y11.8%

GM growth 5Y10.37%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), CVNA is creating value.
Compared to 1 year ago, CVNA has more shares outstanding
The number of shares outstanding for CVNA has been increased compared to 5 years ago.
Compared to 1 year ago, CVNA has an improved debt to assets ratio.

2.2 Solvency

An Altman-Z score of 10.72 indicates that CVNA is not in any danger for bankruptcy at the moment.
CVNA has a better Altman-Z score (10.72) than 97.52% of its industry peers.
CVNA has a debt to FCF ratio of 9.53. This is a negative value and a sign of low solvency as CVNA would need 9.53 years to pay back of all of its debts.
With a Debt to FCF ratio value of 9.53, CVNA perfoms like the industry average, outperforming 57.02% of the companies in the same industry.
CVNA has a Debt/Equity ratio of 2.14. This is a high value indicating a heavy dependency on external financing.
Looking at the Debt to Equity ratio, with a value of 2.14, CVNA is doing worse than 69.42% of the companies in the same industry.

		Industry Rank	Sector Rank
Debt/Equity	2.14
Debt/FCF	9.53
Altman-Z	10.72

ROIC/WACC1.83

WACC9.58%

2.3 Liquidity

A Current Ratio of 4.05 indicates that CVNA has no problem at all paying its short term obligations.
The Current ratio of CVNA (4.05) is better than 93.39% of its industry peers.
CVNA has a Quick Ratio of 2.55. This indicates that CVNA is financially healthy and has no problem in meeting its short term obligations.
The Quick ratio of CVNA (2.55) is better than 91.74% of its industry peers.

		Industry Rank	Sector Rank
Current Ratio	4.05
Quick Ratio	2.55

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WACC

Debt/Equity

How to determine the health of a company

Altman-Z score

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3. Growth

3.1 Past

The Earnings Per Share has grown by an impressive 43700.00% over the past year.
The Revenue has grown by 45.55% in the past year. This is a very strong growth!
CVNA shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 28.25% yearly.

EPS 1Y (TTM)43700%

EPS 3YN/A

EPS 5YN/A

EPS Q2Q%60.94%

Revenue 1Y (TTM)45.55%

Revenue growth 3Y2.19%

Revenue growth 5Y28.25%

Sales Q2Q%54.5%

3.2 Future

The Earnings Per Share is expected to grow by 49.29% on average over the next years. This is a very strong growth
Based on estimates for the next years, CVNA will show a very strong growth in Revenue. The Revenue will grow by 27.94% on average per year.

EPS Next Y234.73%

EPS Next 2Y113.36%

EPS Next 3Y86.22%

EPS Next 5Y49.29%

Revenue Next Year48.28%

Revenue Next 2Y37.59%

Revenue Next 3Y32.95%

Revenue Next 5Y27.94%

3.3 Evolution

The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.

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4. Valuation

4.1 Price/Earnings Ratio

CVNA is valuated quite expensively with a Price/Earnings ratio of 109.24.
The rest of the industry has a similar Price/Earnings ratio as CVNA.
Compared to an average S&P500 Price/Earnings ratio of 27.32, CVNA is valued quite expensively.
CVNA is valuated quite expensively with a Price/Forward Earnings ratio of 66.94.
CVNA's Price/Forward Earnings is on the same level as the industry average.
Compared to an average S&P500 Price/Forward Earnings ratio of 24.32, CVNA is valued quite expensively.

		Industry Rank	Sector Rank
PE	109.24
Fwd PE	66.94

4.2 Price Multiples

Based on the Enterprise Value to EBITDA ratio, CVNA is valued a bit more expensive than 67.77% of the companies in the same industry.
CVNA's Price/Free Cash Flow ratio is in line with the industry average.

		Industry Rank	Sector Rank
P/FCF	190.63
EV/EBITDA	51.06

4.3 Compensation for Growth

CVNA's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
CVNA's earnings are expected to grow with 86.22% in the coming years. This may justify a more expensive valuation.