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    Carvana (CVNA) Valuation Check After S&P 500 Inclusion And Renewed Profitability Focus

    Simply Wall St·01/08/2026 19:32:47
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    Carvana (CVNA) is back in the spotlight after its S&P 500 inclusion and a sharp pickup in retail-unit growth, and investors are now treating the upcoming earnings report as a key check on its profitability push.

    See our latest analysis for Carvana.

    The latest move has taken Carvana’s share price to US$450.78, with a 90 day share price return of 25.21% and a 1 year total shareholder return of 128.82%, suggesting momentum has been building alongside S&P 500 inclusion, insider trading plan activity and rising social media interest.

    If Carvana’s volatility has your attention, this could be a good moment to look at how other auto names are trading through Simply Wall St’s auto manufacturers.

    With Carvana now in the S&P 500, a share price of US$450.78 and very strong 1 year gains, the key question is whether recent earnings momentum still leaves upside on the table or if the market is already pricing in future growth.

    Most Popular Narrative: 7.5% Overvalued

    The most followed narrative sees Carvana’s fair value at about US$419.45, slightly below the last close of US$450.78. This frames the current debate around its growth and profitability path.

    The acceleration in consumer preference for purchasing vehicles online and increased comfort with high-value e-commerce transactions positions Carvana to capture a larger share of the used vehicle retail market, supporting outsized long-term unit and revenue growth.

    Ongoing advancements in Carvana's data-driven technology, including integration of AI for operational efficiency and customer-facing processes, enable continual process improvement, reducing per-unit costs and fueling net margin expansion.

    Read the complete narrative.

    Want to see what kind of revenue glide path, margin lift, and future earnings multiple are baked into that fair value math? The narrative spells out a bold growth runway, a higher profitability profile, and a premium valuation hurdle that only works if several aggressive assumptions hold together. Curious which specific financial levers carry the most weight in that calculation and how sensitive the outcome is to a few key inputs?

    Result: Fair Value of $419.45 (OVERVALUED)

    Have a read of the narrative in full and understand what's behind the forecasts.

    However, this story can change quickly if logistics bottlenecks at ADESA sites or softer used car demand increase per unit costs and pressure margins.

    Find out about the key risks to this Carvana narrative.

    Build Your Own Carvana Narrative

    If you see the numbers differently or want to stress test your own assumptions, you can create a custom Carvana view in just a few minutes, starting with Do it your way.

    A great starting point for your Carvana research is our analysis highlighting 2 key rewards and 2 important warning signs that could impact your investment decision.

    Ready To Hunt For Your Next Idea?

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    This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.