Carvana Co. (NYSE:CVNA) has reported a series of stock sales by significant shareholder Ernest C. Garcia II, amounting to over $8.2 million. The transactions, which took place between April 26 and April 29, 2024, involved the sale of Class A Common Stock at prices ranging from $80.0928 to $87.8791.
On April 26, Garcia sold 50,000 shares at an average price of $80.0928. The sales continued on April 29 with multiple transactions: 6,204 shares sold at an average price of $83.8822; 22,246 shares at $84.9145; 14,537 shares at $85.9585; 5,764 shares at $86.7816; and 1,249 shares at $87.8791. Following these sales, Garcia still holds a substantial amount of Carvana stock, with a direct ownership of 3,212,500 shares and various indirect holdings through trusts and LLCs.
These sales were conducted under a Rule 10b5-1 trading plan, which was adopted by Garcia and his spouse on March 11, 2024. This plan allows company insiders to set up a predetermined schedule for buying or selling stocks at a time when they are not in possession of material non-public information, providing a defense against allegations of insider trading.
Ernest C. Garcia II is a significant figure at Carvana, known for being a ten percent owner of the company. Despite the recent sales, his continued substantial ownership indicates ongoing vested interest in the company's success.
Investors often monitor insider transactions for insights into a company's health and potential future performance. Carvana, which operates in the auto retail and gasoline stations sector, has experienced varying stock performance, making these transactions noteworthy to shareholders and potential investors.
InvestingPro Insights
Amidst the insider transactions at Carvana Co. (NYSE:CVNA), investors seeking a deeper understanding of the company's financial health can glean valuable insights from InvestingPro metrics and tips. Carvana's market capitalization stands at $9.7 billion, reflecting the company's substantial size within the auto retail sector. Despite a challenging period, Carvana's revenue for the last twelve months as of Q4 2023 reached $10.77 billion, although this represents a decrease of 20.82% from the previous year. The company's gross profit margin during the same period was 16.01%, which may raise concerns about its profitability.
InvestingPro Tips suggest that Carvana is trading at a low P/E ratio relative to near-term earnings growth, which could be a point of interest for value investors. Additionally, the stock has seen a significant return over the last week, with a price total return of 10.76%. However, it's important to note that analysts do not anticipate the company will be profitable this year, and the stock price movements have been quite volatile, as evidenced by a 1106.92% return over the last year. For those considering an investment in Carvana, these factors should be weighed carefully.
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