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  "documentTitle": "Carvana Co. (CVNA)",
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  "sourceTypeLabel": "Short seller",
  "presentationDate": "2019-03-01 00:00:00",
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  "notes": "Uses direct quotes from 10-K filings to highlight the discrepancy in segment reporting between Carvana and CarMax.",
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      "kind": "callout",
      "text": "CarMax reporting of two distinct segments seems more appropriate",
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      "kind": "callout",
      "text": "Are we really to believe that Carvana operates just one business, and that originating/selling subprime auto loans is not economically different from auto sales?",
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      "text": "We operate in two reportable segments: CarMax Sales Operations and CarMax Auto Finance (\"CAF\"). Our CarMax Sales Operations segment consists of all aspects of our auto merchandising and service operations, excluding financing provided by CAF. Our CAF segment consists solely of our own finance operation that provides financing to customers buying retail vehicles from CarMax.",
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      "text": "Note that, despite the fact that its loan sales are such significant drivers of gross profit, management claims to believe that it is appropriate for the business to operate in one reportable segment, whereas CarMax segregates its auto finance business into a separate segment (though it also operates a captive finance company). We believe that Carvana should do the same, and that this would provide greater transparency into its questionable auto finance-related activities.",
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      "text": "Business segments are defined as components of an enterprise about which discrete financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing operating performance. Based on the way the Company manages its business, the Company has determined that it currently operates with one reportable segment. The chief operating decision maker focuses on consolidated results in assessing operating performance and allocating resources. Furthermore, the Company offers similar products and services and uses similar processes to sell those products and services to similar classes of customers throughout the United States (\"U.S.\"). All revenue is generated and all assets are held in the U.S. for all periods presented.",
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      "kind": "quote",
      "text": "Based on the way the Company manages its business, the Company has determined that it currently operates with one reportable segment. — CVNA FY 2017 10-K",
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      "kind": "title",
      "text": "Reporting Two Businesses With Different Economics As A Single Segment",
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