Carvana's Profit Surge Propels Stock to New Heights

Carvana Co. exceeded profit expectations in the fourth quarter of 2023 and anticipates improved earnings this quarter, leading to a surge in its shares. Despite challenges posed by high interest rates and inflation, the used-car retailer reported adjusted earnings before interest, taxes, depreciation, and amortization of $60 million, surpassing analysts' estimates. While the company has made progress in reducing debt, it is expected to continue burning cash this year. Carvana's gross profit per unit rose, but it still faces a substantial debt burden and large interest payments. The company's shares rose 20% after-hours, and it anticipates first-quarter adjusted Ebitda to be "significantly above" $100 million.