CVNA
Carvana Co.
$65.87
Platform & Compounding FCF
85%
Two-stage FCF DCF
Strong
·
Conviction
Overvalued
Trading 92.8% above fair value
You pay
$65.87
Bear
$19.36
Fair
$34.17
Bull
$51.67
Bear
$19.36
-70.6%
11% stage 1 growth, 12% discount
Fair
$34.17
-48.1%
18% stage 1 growth, 12% discount
Bull
$51.67
-21.6%
23% stage 1 growth, 12% discount
Adjust Assumptions
17.7%
12.0%
3.0%
Key Value Driver
FCF growth rate (18% base case)
Terminal Value % of EV
40%
Implied Market Multiple
61.6x
Market is pricing in (growth)
26.2%
vs 17.7% base
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (46 analysts)
$84.55
Divergence from AlphaVal
60%
Summary
Using a two-stage FCF DCF with 18% growth decelerating over 15 years, discounted at 12%, the base-case intrinsic value is $34.17 per share.
Warnings
Wall Street's average price target is $84.55 (from 46 analysts). Our estimate is 60% below the consensus -- consider that gap carefully.
Key Risks
- P/E alone misleads — earnings depressed by growth investment
- Cyclical or commodity businesses may be misclassified as platforms
- Terminal value dominance suggests sensitivity to long-run assumptions