Carvana ( NYSE: CVNA ) lost another bull on Wednesday as Truist Securities stepped to the sidelines.
The bank’s analysts advised that their rating was moving to Hold from a prior Buy. Additionally, the team cut its price target drastically, from $50 to just $5.
“Our move to a Hold reflects the risk to equity holders from a potential debt restructuring, which could happen if management looks to bring high debt servicing costs under control as the business continues to face headwinds from a tough macro,” the downgrade explained. “While the company has been aggressively cutting fixed expense, we also see execution risks as elevated. As a result, we opt to move to the sidelines.”
Carvana ( CVNA ) stock has crashed over 98% in 2022.
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Carvana cut to Hold at Truist amid debt restructuring risk