Daily Market Brief
In 2022 I shorted Carvana and put out a report on it for DeltaOne Members then in April released this video explaining (part of the thesis) why it would likely trade to $0. The stock traded to sub $10 and since then has rallied +1,500% or so.
The material info for the short then is the same as it is today.
The difference, as I see it, are a few things:
They now have the PIK loan interest which is eating up a lot of cash
You have a weakened US consumer base with interest rates choking out many people in the lower to middle income demo that Carvana caters too.
The final one you can research and come to your own conclusion. I’ve come to a conclusion based on some other sector shorts that I am gearing up for but it just so happens that the consumer, at large, is affected by the same thing.
To be clear, I am not trying to convince any of you to short-this or to do this to “be right” (even though Uncle Howard from StockTwits did take me to a dinner at Steak 44 to talk shop, thanks Uncle H if you’re reading)
Every once in a while (in fact a week ago on USD/JPY it happened) Mr. Market gives you a free shot-on-goal and this is one of those situations, or so that is the conclusion I have come to.
This is from Asif Suria and his site, Insider Arbitrage - I use it for part of my event-driven book and it has everything I need.
The selling doesn’t matter but they’re pretty good at it, as well as timing the buying.
I am going to dive into this a little tonight in the video as well as cover the usual S&P/Nasdaq items so let’s just dive in…