Following a downgrade by a Morgan Stanley analyst who pulled his rating on the carmaker and claimed it could fall to a sub-$1 stock, Carvana shares plunged to their lowest level in over five years.

Between a declining used car market and the effects of rising interest rates on the funding environment, it is all adding, “material risk to the outlook,” according to Morgan Stanley’s Adam Jonas. He issued the warning in a note Friday, following Carvana’s quarterly report missing on estimates. He withdrew his previous $68 price target, noting the company was worth between $1 and $40 per share.

Carvana promptly fell 39% to $8.76, the lowest close since May of 2017. As of early March, Jonas had placed a $430 price target for the stock, and as late as May was still listing it as a buy.

Declining used car prices in a slowing market are combining with rising borrowing costs to hammer auto retailers. Just a few months ago, retailers were enjoying record prices on used cars, as they capitalized on low borrowing costs to offer cheap loans to buyers. Chief Executive Officer Ernie Garcia noted Carvana is bracing for a slowdown in the used auto market and higher rates of depreciation.

On an earnings call he said, “We are building our plans around assumptions that the next year is a difficult one in our industry and the economy as a whole.”

In August of 2021, Carvana shares were trading above $370. The recent plunge in share prices has high-profile investors like Tiger Global Management and Baillie Gifford & Co. slashing their stakes in the auto-dealer.