5 Best Used Car Stocks To Buy According to Hedge Funds

4. Carvana Co. (NYSE:CVNA)

Market cap as of March 24: $1.48 Billion
Number of Hedge Fund Holders: 36

Carvana Co. (NYSE:CVNA) operates a US e-commerce platform for buying and selling used cars. Customers can research, inspect, finance, purchase, and schedule delivery or pick-up using the company’s technology via desktop or mobile devices. Carvana Co. (NYSE:CVNA) shares have offered investors more than 76% in returns year-to-date.

Evercore ISI analyst Michael Montani increased his price target on Carvana Co. (NYSE:CVNA) to $10 from $9 and maintained an ‘In Line’ rating on the stock after the company pre-announced Q1 results and proposed a debt swap to restructure its balance sheet.

Hedge funds tracked by Insider Monkey having stakes in Carvana Co. (NYSE:CVNA) decreased to 36 in Q4 from 43 in the preceding quarter. These stakes hold a consolidated value of $209.84 million. Spruce House Investment Management is a significant shareholder in the company, with 10 million shares valued at $47.40 million.

Saga Partners specifically reported on Carvana Co. (NYSE:CVNA) in its second half 2022 investor letter:

“I have discussed Carvana Co. (NYSE:CVNA) several times since we first purchased it in 2019 but want to provide an update given the stock’s decline and negative headlines. Historically, Carvana has grown gross profits at a faster rate than operating costs. In 2021, Carvana grew retail unit volumes 74% to over 400,000 cars to become the second largest used car dealer after CarMax. Carvana reached $1.9 billion in gross profits, EBITDA breakeven, and expectations entering 2022 were for continued unit volume growth and scale operating costs.…” (Click here to read the full text)