TEMPE, Ariz.—Mark W. Jenkins, the Chief Financial Officer of Carvana Co. (NYSE:CVNA), executed a series of stock transactions as reported in recent filings. On November 4th and 5th, Jenkins sold a total of 163,946 shares of Carvana's Class A common stock. The shares were sold at prices ranging from $220.30 to $242.79 per share, amounting to a total of approximately $60.96 million.
In addition to the sales, Jenkins exercised stock options to acquire 108,495 shares of Class A common stock at prices between $10.07 and $44.21 per share. These transactions were conducted under a Rule 10b5-1 trading plan, which Jenkins adopted on August 5, 2024.
Following these transactions, Jenkins retains direct ownership of 90,732 shares of Carvana's Class A common stock. The stock sales and option exercises reflect Jenkins' ongoing management of his equity holdings in the company.
In other recent news, Carvana has been making significant strides in its financial performance. The online used car retailer reported a record-breaking third quarter in 2024, showcasing a 34% year-on-year increase in retail units sold, contributing to a 32% surge in revenue. The company's net income reached $148 million, with an operating income of $337 million, and an adjusted EBITDA of $429 million. This strong performance has led to an upgrade in Carvana's stock rating by Morgan Stanley (NYSE:MS) from Underweight to Equal-weight, following earnings that surpassed expectations.
The company's revenue for the quarter hit $3.655 billion, and it plans to increase its advertising spend by $5 million to $10 million in Q4. It also anticipates an adjusted EBITDA significantly above the $1.0 billion to $1.2 billion range for the full year 2024. However, it's worth noting that Carvana's non-GAAP SG&A expenses rose 10% to $406 million.
Further, Carvana achieved milestones of selling and purchasing over 2 million cars, capturing only 1% of the $1 trillion used car market. These recent developments highlight Carvana's ongoing efforts to position itself for sustainable growth and market expansion.
InvestingPro Insights
The recent stock transactions by Carvana's CFO Mark W. Jenkins come amid a period of significant growth for the company. According to InvestingPro data, Carvana's stock has shown remarkable performance, with a 619.02% price total return over the past year and a 94.3% return in the last six months. This aligns with the timing of Jenkins' stock sales, which occurred at prices ranging from $220.30 to $242.79 per share.
InvestingPro Tips highlight that Carvana has a perfect Piotroski Score of 9, indicating strong financial health. This could explain the confidence behind the CFO's decision to exercise options and sell shares. Additionally, the company's revenue growth of 12.21% over the last twelve months and a quarterly revenue growth of 31.81% in Q3 2024 suggest a robust business trajectory.
However, investors should note that Carvana is trading at high valuation multiples. The company's P/E ratio stands at 1,660, and it's trading at a high Price / Book multiple of 81.46. These metrics, combined with the InvestingPro Tip that the stock's RSI suggests it's in overbought territory, may provide context for Jenkins' decision to sell a portion of his holdings.
For those seeking a deeper understanding of Carvana's financial position, InvestingPro offers 21 additional tips, providing a comprehensive view of the company's prospects and potential risks.
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