Ryan S Keeton, Chief Brand Officer at Carvana CVNA, disclosed an insider sell on June 11, according to a recent SEC filing.
What Happened: A Form 4 filing from the U.S. Securities and Exchange Commission on Wednesday showed that Keeton sold 11,276 shares of Carvana. The total transaction amounted to $3,841,507.
The latest market snapshot at Thursday morning reveals Carvana shares down by 2.33%, trading at $332.39.
Discovering Carvana: A Closer Look
Carvana Co is an e-commerce platform for buying and selling used cars. The company derives revenue from used vehicle sales, wholesale vehicle sales and other sales and revenues. The other sales and revenues include sales of loans originated and sold in securitization transactions or to financing partners, commissions received on VSCs and sales of GAP waiver coverage. The foundation of the business is retail vehicle unit sales. This drives the majority of the revenue and allows the company to capture additional revenue streams associated with financing, VSCs, auto insurance and GAP waiver coverage, as well as trade-in vehicles.
A Deep Dive into Carvana’s Financials
Revenue Growth: Over the 3 months period, Carvana showcased positive performance, achieving a revenue growth rate of 38.26% as of 31 March, 2025. This reflects a substantial increase in the company’s top-line earnings. As compared to its peers, the company achieved a growth rate higher than the average among peers in Consumer Discretionary sector.
Navigating Financial Profits:
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Gross Margin: The company maintains a high gross margin of 21.95%, indicating strong cost management and profitability compared to its peers.
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Earnings per Share (EPS): Carvana’s EPS is below the industry average, signaling challenges in bottom-line performance with a current EPS of 1.61.
Debt Management: Carvana’s debt-to-equity ratio stands notably higher than the industry average, reaching 4.02. This indicates a heavier reliance on borrowed funds, raising concerns about financial leverage.
Valuation Metrics: A Closer Look
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Price to Earnings (P/E) Ratio: The current Price to Earnings ratio of 118.58 is higher than the industry average, indicating the stock is priced at a premium level according to the market sentiment.
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Price to Sales (P/S) Ratio: The current P/S ratio of 2.91 is above industry norms, reflecting an elevated valuation for Carvana’s stock and potential overvaluation based on sales performance.
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EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): A high EV/EBITDA ratio of 30.28 reflects market recognition of Carvana’s value, positioning it as more highly valued compared to industry peers.
Market Capitalization Analysis: The company’s market capitalization surpasses industry averages, showcasing a dominant size relative to peers and suggesting a strong market position.
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Unmasking the Significance of Insider Transactions
Insider transactions shouldn’t be used primarily to make an investing decision, however, they can be an important factor for an investor to consider.
In the context of legal matters, the term “insider” refers to any officer, director, or beneficial owner holding more than ten percent of a company’s equity securities, as outlined by Section 12 of the Securities Exchange Act of 1934. This includes executives in the c-suite and significant hedge funds. Such insiders are obligated to report their transactions through a Form 4 filing, which must be completed within two business days of the transaction.
Pointing towards optimism, a company insider’s new purchase signals their positive anticipation for the stock to rise.
Despite insider sells not always signaling a bearish sentiment, they can be driven by various factors.
Breaking Down the Significance of Transaction Codes
Investors prefer focusing on transactions that take place in the open market, indicated in Table I of the Form 4 filing. A P in Box 3 indicates a purchase, while S indicates a sale. Transaction code C indicates the conversion of an option, and transaction code A indicates grant, award or other acquisition of securities from the company.
Check Out The Full List Of Carvana’s Insider Trades.
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This article was generated by Benzinga’s automated content engine and reviewed by an editor.
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