Investing.com -- Shares in Carvana (NYSE:CVNA) surged in premarket US trading after the online used-car retailer rolled out upbeat full-year guidance and blowout third-quarter income.
Should the gains hold, the stock is on pace to touch its highest level since Dec. 2021.
The company best known for its vehicle vending machines reported third-quarter earnings of $0.64 a share on revenue of $3.66 billion, compared with Wall Street estimates for per-share profit of $0.29 on revenue of $3.45 billion. Retail units sold jumped 34% to 108,651, while Carvana also focused on cost-cutting measures to help lift profits.
Carvana said it now expects annual earnings to be “significantly above the high end” of its previously projected range of $1.00 billion to $1.20 billion. It also forecasts a "sequential increase in its year-over-year growth rate in retail units sold."
In a note to clients, Morgan Stanley (NYSE:MS) analysts Adam Jones said the "big beat" in Carvana's results "make a strong case for the company to have achieved 'escape velocity' on profitable growth being more than a temporary phenomenon."
Analysts have previously said that Carvana is "well positioned" to take advantage of more car buyers doing their shopping online.
(Yasin Ebrahim contributed reporting.)