Carvana stock clobbered on downgrades: The week’s biggest analyst moves

Amid the biggest ratings changes in the past week, Carvana shares took a plunge after cuts by several analysts. Here are all of this past week’s most significant analyst-rating changes, covered first on InvestingPro+. Sign up for rapid-fire coverage of upgrades and downgrades.

Carvana Downgraded by Wedbush, William Blair, and Needham

Wedbush was the first shop this week to come out and swing for the fences on Carvana, downgrading the stock to Underperform Wednesday with a price of $1.

The analyst sees risks of a bankruptcy and noted the Investor Relations Director Mike Levin has recently left the company.

Wedbush fears a debt restructuring of the troubled used-car vending machine operator will leave no value remaining for holders of Carvana’s common equity.

William Blair quickly followed suit with its own Carvana downgrade, to Market Perform from Outperform.

And Needham downgraded the shares Friday to Hold from Buy.

Needham notes that, beyond the bankruptcy fears permeating the Street, a second round of layoffs at the company has damaged confidence in management’s ability to execute a turnaround plan.

Carvana shares fell almost 40% intraday on the Wedbush downgrade, and the stock’s 5-day performance came to a loss of 36.4%.

MGM Resorts Upgraded by Truist to Buy

A Truist analyst on Monday reversed a historically more cautious view on the Las Vegas strip and destination markets (think Macau).

The reversal, when first reported on InvestingPro+, drove MGM (NYSE:) shares higher in premarket trading – up to a $38 handle at 4 a.m. EST.

Truist also mentioned that an in-house survey shows room strength appears stable.

MGM ultimately slipped 4.5% for the week.

Boston Beer: Downgraded by Deutsche Bank to Sell

Deutsche Bank on Tuesday downgraded Boston Beer (NYSE:) to Sell within a 2023 industry outlook note that saw seven downgrades across the U.S. Consumer Staples space.

Declines in Hard Seltzer show no signs of stabilizing, according to Deutsche Bank.

The analyst also said Boston Beer has seen its Sam Adams brand oversaturate the market as it has risen in popularity alongside craft beer before that specialty market slowed in growth.

Shares took a steep slide in Tuesday’s session and are down 6.6% for the week.

Hershey Co Upgraded by UBS to Buy

UBS upgraded Hershey Co (NYSE:) to Buy Friday, citing relative strength displayed in the large-cap packaged-foods sector.

The analyst suspects Hershey will benefit from investor joy over the company remaining “in a beat and raise cycle through 2025.”

UBS further commented, “While we do not expect HSY to fully close the gap with their high-growth peers, it nevertheless underscores the potential for HSY to re-rate higher over time.”

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