After a meteoric rise and equally epic fall, Carvana’s stock is up more than 500% in a year. But one top analyst thinks the ride gets rougher from here

Everyone likes a comeback story. Carvana shares have gained more than 500% over the past year and reached a new 52-week high of $136.92 on Friday. But analysts are debating whether the Fortune 500 company, whose CFO is a former Wharton professor, can keep up the pace.

Carvana, an e-commerce platform for buying and selling used cars, was founded in 2012 and went public in 2017. Carvana cofounder and chair Ernie Garcia has served as president and CEO since the company’s founding, while CFO Mark Jenkins came on board in July 2014. Before joining Carvana, Jenkins was a professor in the finance department at The Wharton School of the University of Pennsylvania for five years teaching undergraduate, MBA, and executive education programs.

The Tempe, Ariz.-based company had a meteoric rise, earning $5.587 billion in revenue in 2020, and in 2021 landed on the Fortune 500 list for the first time. But in 2022, Carvana hit a wall.

The company piled on debt, and high interest rates on car sales and loans pummeled sales, all of which led to bankruptcy concerns. Carvana, trading under the ticker CVNA on the New York Stock Exchange, plummeted to an all-time low of $3.55 on Dec. 7, 2022, a 99% plunge from a record high of $370.10. Carvana was forced to restructure its debt.

Analysts are split on where things go from here. “The general expectation is that CVNA stock will ride the momentum until the end of the year, making it an ideal portfolio addition for the second half of the year,” according to an email to Fortune from Joel Lim, financial analyst at Trading.biz. And JPMorgan reiterated on June 27 its Overweight rating on Carvana with a steady price target of $150.

In Wedbush Securities’ June 26 note to investors, the analysts said the company has made significant additional technology- and process-driven improvements in reconditioning and logistics over the past six months. But looking forward, efficiency gains appear more limited. Wedbush reiterated a neutral rating and maintains a 12-month $120 price target.

Seth Basham, a managing director at Wedbush, told Fortune his take. “There could still be some stock price upside because of the momentum and fundamentals,” Basham said. “But beyond this near-term period, it’s going to be a lot more difficult for them to sharply accelerate their fundamentals, particularly the bottom line because they’ve made most of the available gains in efficiencies in their operations.”

Carvana is a used auto retailer, and it’s a very “operationally intensive business,” which doesn’t scale like a tech company would scale, he said. The operational intensity includes hiring staff to acquire the cars, recondition and move them, and also service customers, he explained. “They’re much better positioned to handle that intensity than they were a few years ago, when they ran into some major roadblocks,” Basham said. “But nonetheless, moving faster than growing 10,000 cars or so per quarter sequentially is going to be challenging.”

Carvana’s “turnaround has been nothing short of remarkable,” Basham noted, adding that he and many others “didn’t think it was possible for Carvana to show this much improvement, this quickly,” including reaching their current KPI levels in areas like gross profit per unit and retail unit sold. However, looking forward to the next 18 months, it’s going to be “nearly impossible for them to replicate that level of improvement in profitability,” he added.

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