Is it Time to Sell Your Carvana (CVNA) Shares?

ClearBridge Investments, an investment management firm, published its “SMID Cap Growth Strategy” third quarter 2021 investor letter – a copy of which can be downloaded here. During the third quarter, the ClearBridge SMID Cap Growth Strategy outperformed the benchmark Russell 2500 Growth Index. On an absolute basis, the Strategy had gains across five of the 10 sectors in which it was invested during the quarter (out of 11 sectors total), with the health care sector the leading contributor and the consumer discretionary sector being the main detractor. You can take a look at the fund’s top 5 holdings to have an idea about their best picks for 2021.

ClearBridge SMID Cap Growth Strategy, in its Q3 2021 investor letter, mentioned Carvana Co. (NYSE: CVNA) and discussed its stance on the firm. Carvana Co. is a Tempe, Arizona-based e-commerce company with a $41.5 billion market capitalization. CVNA delivered a -2.41% return since the beginning of the year, while its 12-month returns are down by -6.69%. The stock closed at $233.76 per share on December 28, 2021.

Here is what ClearBridge SMID Cap Growth Strategy has to say about Carvana Co.  in its Q3 2021 investor letter:

“On the sell side, we closed out of Carvana in the consumer discretionary sector as it surpassed the upper bound of our market capitalization range. Carvana, which operates the largest online used car platform, is an example of the innovative business models we seek out in companies.”

Pixabay/Public Domain

Based on our calculations, Carvana Co. (NYSE: CVNA) was not able to clinch a spot in our list of the 30 Most Popular Stocks Among Hedge Funds. CVNA was in 58 hedge fund portfolios at the end of the third quarter of 2021, compared to 63 funds in the previous quarter. Carvana Co. (NYSE: CVNA) delivered a -23.55% return in the past 3 months.

Earlier this month, we published an article that involved CVNA in the Top 5 Stock Picks of Leon Shaulov’s Maplelane Capital. You can find more than 100 investor letters from hedge funds and prominent investors on our hedge fund investor letters 2021 Q3 page.

Disclosure: None. This article is originally published at Insider Monkey.