Carvana Co (NYSE:CVNA) Fits Mark Minervini’s Trend-Following Strategy with Strong Technicals and Growth Fundamentals

Carvana Co (NYSE:CVNA) has become a possible choice for investors using Mark Minervini’s trend-following strategy, which blends technical strength with strong growth fundamentals. The method, based on Minervini’s SEPA (Specific Entry Point Analysis) framework, spots stocks with notable price momentum, rising moving averages, and solid relative strength, while also needing faster earnings and revenue growth to confirm fundamental health.

Why CVNA Matches the Minervini Trend Template

The Trend Template aims to pick stocks in a clear uptrend, ensuring they meet strict technical rules. CVNA currently meets these requirements:

• Price Above Key Moving Averages: The stock is above its 50-day ($338.29), 150-day ($269.89), and 200-day ($261.14) moving averages, confirming bullish trends in both short and long terms.
• Rising Moving Averages: The 50-day MA is higher than the 150-day and 200-day MAs, while the 150-day MA is also above the 200-day MA, a key feature of Minervini’s preferred trend setup.
• High Relative Strength: With a ChartMill Relative Strength (CRS) score of 94.76, CVNA beats 94% of all stocks, a trait common in market leaders.
• Price Close to 52-Week High: At $349.87, CVNA is within 15% of its 52-week high ($413.34) and has jumped 124% over the past year, showing steady momentum.

These technical points match Minervini’s focus on stocks in Stage 2 uptrends, where price pauses (like the recent drop to the $325–$350 range) often lead to further gains.

Strong Growth Fundamentals Supporting the Setup

Beyond technicals, Minervini’s strategy looks for companies with faster earnings and revenue growth, a sign of high-growth momentum. CVNA’s fundamentals are notable:

• Fast Earnings Growth:
  • EPS grew 466% year-over-year (TTM), with recent quarterly growth rates of 814% (Q2Q) and 556% (prior quarter).
  • The company has topped EPS estimates in all of the last four quarters, with an average surprise of 96.2%.
• Strong Revenue Growth:
  • Revenue rose 39.5% over the past 12 months, with quarterly growth rates consistently above 30%.
  • Analysts have lifted next-year EPS estimates by 54% over the past three months, showing positive revisions.
• Better Profit Margins:
  • Net margins improved to 3.78% last quarter, up from 2.23% two quarters ago, indicating better operational efficiency.

These numbers fit Minervini’s idea of “big earnings drawing big attention,” where institutional buyers push prices higher.

Technical Summary and Risk Factors

ChartMill’s technical report gives CVNA a rating of 9/10, highlighting its long-term uptrend and leading relative strength. However, the short-term trend is neutral, with the stock pausing after a rally. Key support levels include:

• $345.50–$347.73 (daily moving averages and trendlines)
• $326.08–$332.11 (multi-timeframe support zone)

While the setup looks strong, traders should watch whether CVNA stays above these levels or breaks past recent highs.

Read the full technical analysis here.

Finding Other High-Growth Momentum Stocks

CVNA is one of several stocks currently fitting Minervini’s Trend Template and high-growth standards. For investors looking for more options, our High Growth Momentum + Trend Template screen offers a selected list of qualifying stocks.

Disclaimer: This analysis is for informational purposes only and does not constitute investment advice. Always conduct your own research and consider risk management strategies before trading. Read our full disclaimer here.