Carvana Plummets After Morgan Stanley Warns It May Be a $1 Stock
- Adam Jonas had a price target of $430 a share in March
- Rising rates and falling used-car values hobble auto retailers
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Carvana Co. shares plunged to the lowest in more than five years after a Morgan Stanley analyst pulled his rating on the auto retailer and said its stock could be worth as little as $1.
The deteriorating used-car market and volatile interest-rate and funding environment “add material risk to the outlook,” Morgan Stanley’s Adam Jonas said in a note Friday after Carvana reported quarterly results that missed estimates. He pulled his $68 price target and said his new base case is that the company may be worth $1 to $40 a share.