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Pull up a chair. $CVNA is an opaque subprime origination machine attached to a management compensation scheme. When investors let the fox guard the hen house, they shouldn’t be surprised at the result. It escapes me completely how institutions will put https://t.co/8V1101qybO

— Investor Gator 🐊 (@GatorInvestor) October 29, 2019

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up with such nonsense, but given that they do, situations like $CVNA will flourish.

What do I mean by “situations”? You have an ex-con who was thwarted in his efforts to take his subprime auto business public now fronting a newly formed entity with deep ties to the business

— Investor Gator 🐊 (@GatorInvestor) October 29, 2019

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that not even Wall St would IPO. That’s $CVNA. Revenue is up 25-fold in four years, but cumulative losses of over $600mm and free cash burn of over $1.4B during that time tell the real story.

— Investor Gator 🐊 (@GatorInvestor) October 29, 2019

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The real story is that $CVNA self-finances upwards of 70% of the loans its customers need to buy its cars. AutoNation does no such self-financing and CarMax finances close to half its customers this way. Disclosures

— Investor Gator 🐊 (@GatorInvestor) October 29, 2019

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on its origination activities are inadequate IMO and according to other sophisticated investors. Meanwhile, we see anomalies such as big increases in average transaction price in a mature industry.https://t.co/3QdHY96nzA

— Investor Gator 🐊 (@GatorInvestor) October 29, 2019

6/$CVNA serially issues securities to stay in business while management is dumping stock hand over fisthttps://t.co/5V3GVU5hwz

— Investor Gator 🐊 (@GatorInvestor) October 29, 2019

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I guess it’s ok since the stock is ripping? But isuspect few investors really understand how the business operates. Investors can read about the business in detail here:https://t.co/GIqvvmoaaU

— Investor Gator 🐊 (@GatorInvestor) October 29, 2019

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I suspect there is a reason we have such an opaque business plan paired with such a…colorful, stock liquidating management team. Recall, not only is the fox guarding the hen house: pic.twitter.com/G7vV28WbJr

— Investor Gator 🐊 (@GatorInvestor) October 29, 2019

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but he changed the locks so no one else can even get in: pic.twitter.com/cm5ohaUfi8

— Investor Gator 🐊 (@GatorInvestor) October 29, 2019

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So next time investors see another great earnings report They should ask themselves if they really understand the business:https://t.co/ZAUaCbHkX9

— Investor Gator 🐊 (@GatorInvestor) October 29, 2019

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And then they should ask themselves when the next executive stock sale is. And when the next equity issuance is.

— Investor Gator 🐊 (@GatorInvestor) October 29, 2019

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