NEW YORK, Feb 21, 2026, 13:48 EST — Market shut down for the day.
Carvana Co ended Friday at $336.62, up 1.2%, a modest rebound after the stock’s big move following earnings earlier this week. 1
Why it matters now: For traders, attention has swung back to Carvana’s profit per car, instead of just unit sales. In the fourth quarter, gross profit per unit landed at $6,427—below what analysts were looking for. The company pointed to continued high vehicle reconditioning costs into Q1. Carvana put out a call for “significant growth” in both vehicle sales volume and adjusted EBITDA, the latter a popular cash-flow metric, but stopped short of offering hard numbers. Both Wedbush and JPMorgan trimmed their price targets, to $425 and $490 respectively. 2
It’s a delicate setup. Carvana shares slid close to 8% on Thursday, and short interest remains hefty: Ortex data showed around 14.84 million shares sold short, accounting for about 10.7% of the free float as of Feb. 17. Stephens analyst Jeff Lick described the move down as “a potential opportunity,” but cautioned that stocks trading at a premium can stumble hard even on small disappointments. 3
Carvana stumbled through its latest earnings release. Fourth-quarter profit missed analyst targets, with spending on inspections, repairs and detailing ramping up at various sites, and retail depreciation ticking higher. After-hours, shares dropped 15% Wednesday, according to Reuters. On the call, CFO Mark Jenkins flagged that these cost pressures will linger into Q1, and took a shot at Gotham City Research, saying, “We don’t sell loans to related parties.” 4
Now investors face a choice: was that cost surge just a blip at some sites, or is it going to stick around? If these pressures persist, the narrative shifts away from demand and zeroes in on execution.
Regulators aren’t the whole story here. Carvana’s stock has long attracted retail traders, and with so much two-way positioning, headlines can spark outsized swings.
Fresh details surfaced in Carvana’s annual report, filed Feb. 18, pointing to both new context and fresh risks. The company flagged that used-car sales hit their usual high late in the first quarter, boosted by federal tax refunds, and warned that seasonality could play a larger role down the line. There’s also the relationship with DriveTime — labeled a related party, thanks to the Garcia family’s control. Some deals, Carvana said, “cannot be assumed to have been negotiated at arm’s length.” The report also confirmed that Carvana sold zero finance receivables to DriveTime between 2017 and 2025. CarMax turns up on the list of standard used-car rivals, while Amazon and eBay Motors appear as online competition. 5
The basic risk hasn’t changed: if reconditioning and depreciation don’t ease up, first-quarter profit estimates come down, and shares could surrender more of their recent gains.
Rates aren’t just background noise. Once borrowing gets pricier, used-car shoppers feel it fast—and lenders usually clamp down just as investors convince themselves those so-called “easy comps” are in reach.
The immediate focus for the market: will Carvana manage to prove in early 2026 that it can grow volumes without sacrificing profit per vehicle?
Carvana expects the replay of its Feb. 18 earnings call to stay up through Wednesday, Feb. 25. Once U.S. markets open again on Monday, Feb. 23, attention shifts to whether the cost discussion gains traction—and to see if analysts adjust their views. 6
