14 Best Consumer Discretionary Stocks to Buy Right Now

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1. Carvana Co. (NYSE:CVNA)

Number of Hedge Fund Holders: 109

Carvana Co. (NYSE:CVNA) is one of the 14 Best Consumer Discretionary Stocks to Buy Right Now.

On February 20, UBS reduced its target price on Carvana by 11.0% to $485 (from $585) but retained its Buy recommendation. This price update was triggered by Carvana’s Q4 2025 earnings miss, which the analyst attributed to higher (albeit temporary) reconditioning costs and flat gross profit per unit (GPU). Despite the cost challenges, the company’s revenue growth targets remain intact, with Carvana on track to achieve its goal of selling 3 million retail units per year by 2035.

For reference, Carvana released its Q4 2025 earnings on February 18, which showed 42.3% YoY growth in adjusted EBITDA. Earnings growth was driven primarily by volume. The company sold 163,522 retail units in Q4, up 43.0% YoY – outpacing traditional used auto dealers, which grew between -3% and 5% YoY.

Despite the rapid volume-driven earnings growth, EBITDA still missed analysts’ expectations due to higher costs. More specifically, Carvana’s management singled out reconditioning costs as exceeding their expectations. The higher cost translated into a 3.7% YoY decline in GPU (from $6,671 to $6,427) and a 100-basis-point YoY contraction in adjusted EBITDA margins (to 9.1% from 10.1%).

Carvana Co. (NYSE:CVNA) operates an e-commerce platform for buying and selling used cars. The company is based in Tempe, Arizona, and was founded in 2012 by Ernest Garcia III, Benjamin Huston, and Ryan Keeton.

While we acknowledge the potential of CVNA as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than CVNA and that has 100x upside potential, check out our report about this cheapest AI stock.

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