Piper Sandler says Carvana’s recent rally may be coming to an end. Shares of Carvana rose more than 20 percent this week after Carvana announced better-than-expected second-quarter results on Wednesday and agreed to restructure about $5.2 billion in debt. However, Piper Sandler kept its long-term outlook for the company’s stock in the used car market unchanged. Analyst Alexander Porter downgraded the stock to neutral from overweight. While he raised his price target to $48 from $29, the new price target is less than $2, just 2.7% above Thursday’s close. “We upgraded CVNA last September because the company was trading at a significant discount to intrinsic value due to bankruptcy risk, which we believe is unlikely to occur,” Porter wrote in a Thursday note. “Now that the bankruptcy scare has abated and the stock has risen to $47, we believe CVNA is approaching a fair valuation.” Porter added: “Chasing the stock higher will require an upward revision to CVNA’s long-term used-vehicle market share forecast, which we do not believe is substantiated by recent results.” Being able to maintain cost control at higher volumes “remains to be seen”. Other downside risks to the company’s growth cited by analysts include vehicle pricing volatility, regulatory changes, macro shocks and high capital intensity. Porter wasn’t the only analyst to downgrade Kavanaugh this week. RBC’s Brad Erickson downgraded the stock to underperform from sector perform, noting that any long-term margin improvement is likely to be reflected at this point. The stock fell 0.7% premarket on Friday after plunging more than 16% during Thursday’s trading session. The stock is still up more than 880% so far this year. CVNA YTD Mountain CVNA 2023 — CNBC’s Michael Bloom contributed reporting.