Shares of Carvana Co (NYSE:CVNA) tanked in early trading on Thursday, after surging on Wednesday following the company's upbeat first-quarter (Q1) results.

Here are the key analyst insights:

  • BTIG analyst Marvin Fong maintained a Buy rating, and raised the price target from $455 to $485.
  • Needham analyst Chris Pierce reiterated a Buy rating, and raised the price target from $500 to $600.

Check out other analyst stock ratings.

BTIG: Carvana vehicles sold up more than 40% for the sixth consecutive quarter. The company's unit sales came in around 3% higher than the consensus of 182,400 units.

Margins were also higher than expected, Fong said in a note. Retail gross profit per unit (GPU) of $3,250 topped Street expectations of around $3,170, he added.

"Looking ahead, CVNA vaguely guided to sequential increases in units and Adjusted EBITDA and reiterated expectations for significant growth for both metrics on a y/y basis," the analyst wrote. He raised the second-quarter estimates for:

  • Unit sales to 193,500, from 185,000
  • Total revenue to $6.8 billion, from $6.7 billion
  • Adjusted earnings to $722 million, from $721 million

Needham: Carvana reported its unit growth above "low investor expectations." It also maintained a bullish tone for the second quarter, Pierce said. Management indicated that the company was already approaching the best-ever labor hours per retail vehicle produced in April, he added.

The results were proof of Carvana's model working, with higher retail units driving operating expense leverage, the analyst stated. "CVNA continues to screen as the best large cap growth story in our coverage ahead of a long tail of growth in units and fixed cost leverage," he further wrote.

CVNA Price Action: Shares of Carvana had declined by 3.4% to $383 at the time of publication on Thursday.

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