What Makes Carvana (CVNA) an Investment Bet?

Brown Advisory, an investment management company, released its “Brown Advisory Mid-Cap Growth Strategy” third-quarter 2025 investor letter. A copy of the letter can be downloaded here. The strategy underperformed its benchmark, the Russell Midcap® Growth Index, in the third quarter of 2025, which increased approximately 3%.  In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its third-quarter 2025 investor letter, Brown Advisory Mid-Cap Growth Strategy highlighted stocks such as Carvana Co. (NYSE:CVNA). Headquartered in Tempe, Arizona, Carvana Co. (NYSE:CVNA) is an e-commerce platform for buying and selling used cars. The one-month return for Carvana Co. (NYSE:CVNA) was 46.30%, and its shares gained 105.53% over the last 52 weeks. On December 17, 2025, Carvana Co. (NYSE:CVNA) stock closed at $446.23 per share, with a market capitalization of $97.07 billion.

Brown Advisory Mid-Cap Growth Strategy stated the following regarding Carvana Co. (NYSE:CVNA) in its third quarter 2025 investor letter:

"We initiated a position in Carvana Co. (NYSE:CVNA), one of the fastest-growing online used car retailers. The company continues to outpace peers with revenue growth above 40% and targets 20–40% annual growth over the next five years. With expanded reconditioning capacity, we expect improving profitability and a widening competitive advantage as the business scales."

Carvana Co. (NYSE:CVNA) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 109 hedge fund portfolios held Carvana Co. (NYSE:CVNA) at the end of the third quarter, which was 91 in the previous quarter. While we acknowledge the potential of Carvana Co. (NYSE:CVNA) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered Carvana Co. (NYSE:CVNA) and shared Sands Capital Global Growth Fund's views on the company. In addition, please check out our hedge fund investor letters Q3 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.