CarvanaCummins

Carvana vs Cummins

Carvana Co. and Cummins Inc. are compared to illuminate their business models, financial performance, and market context. This page presents neutral, accessible explanations of how each company create...

Why It's Moving

Carvana

Carvana Joins S&P 500 Following Strong Profit Surge and Earnings Turnaround

  • Q3 2025 net income reported at $263 million, signaling a major earnings recovery and operational improvement.
  • Trailing twelve-month earnings per share turned positive, highlighting sustained profitability progress.
  • Inclusion in the S&P 500 effective December 22 amplifies visibility and positions Carvana alongside top consumer discretionary companies.
  • Shares have soared more than 10,000% from prior lows, demonstrating strong market momentum and investor optimism.
Sentiment:
🐃Bullish
Cummins

Cummins Shares Surge to New High on Strong Power Systems Demand and Investor Confidence

  • Q3 2025 revenue exceeded expectations at $8.3 billion, driven by strength in Power Systems and Distribution, critical for data centers and generators, signaling resilience in key end markets.
  • Cummins raised its quarterly dividend to $2.00 per share, reinforcing its commitment to shareholder returns and attracting dividend-focused investors seeking steady income streams.
  • The company’s 'Destination Zero' initiative in green hydrogen and hybrid powertrains via its Accelera business is generating positive analyst attention, highlighting future growth avenues beyond traditional engines.
Sentiment:
🐃Bullish

Which Baskets Do They Appear In?

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Investment Analysis

Carvana

Pros

  • Carvana operates the largest online used car retail platform in the US, leveraging technology for a differentiated customer experience and market share gains.
  • The company has demonstrated impressive revenue growth with ambitions of a long-term CAGR of 18-19% through 2032, reflecting strong growth potential.
  • Analyst consensus shows moderate buy ratings with an upside potential around 20%, supported by Carvana’s evolving operational efficiency and market position.

Considerations

  • Carvana’s valuation metrics are notably high, with a P/E ratio above 75 and price-to-book ratio over 40, indicating potentially elevated market expectations and risk.
  • The company faces macroeconomic headwinds and execution risks linked to high debt levels and the volatility of the used car market demand.
  • Carvana’s stock price shows significant volatility, with some forecasts predicting considerable short-term declines, especially in early 2026 and beyond.
Cummins

Pros

  • Cummins is a well-established global leader in engines and power generation products with a strong market position across diverse industries.
  • The company benefits from steady demand driven by infrastructure development, electrification trends, and emissions regulations boosting product upgrades.
  • Cummins maintains a solid balance sheet and has shown consistent profitability supported by operational efficiency and ongoing investments in innovation.

Considerations

  • Cummins is exposed to cyclicality in industrial and automotive sectors, which can pressure earnings during economic downturns.
  • Transition to electrification presents execution risk and competitive challenges as Cummins adapts its product portfolio for emerging clean technologies.
  • Raw material costs and supply chain disruptions pose ongoing margin pressure and potential impacts on production and delivery schedules.

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