Carvana (NYSE:CVNA) once made a great name for itself on the notion of a “car vending machine.” The idea that a car could be bought like a can of soda or a candy bar intrigued many. Yet that one intriguing notion didn’t hold up well as the car market went into crippling shortages, first of supply, then of demand. Carvana shares saw a volatile trading session today, as they were halted several times.
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A quick look at news out of Carvana lately offers some insight into the frantic price swings. Earlier today, the Wall Street Journal pointed out that investors don’t expect Carvana to go bankrupt outright any time soon. Carvana’s creditors aren’t looking for that fate either.
However, Jefferies analyst John Colantuoni pointed out a distressing point in a recent research note. The note revealed Carvana may only have a few months left until it’s completely out of cash. That may not be bankruptcy, but a company without cash isn’t exactly far from it.
Despite all the volatility Carvana has seen of late, it’s still considered a fairly decent stock. Analyst consensus currently calls Carvana a Hold, with an average price target of $24.15. This implies that the company has 385.92% upside potential.
