Benjamin E. Huston, Chief Operating Officer of Carvana Co. (NYSE:CVNA), has recently sold shares of the company. According to the latest SEC filing, Huston sold 3,043 shares of Carvana's Class A common stock on October 31, 2024, at a price of $240 per share, totaling $730,320.
In addition to the sale, Huston had 9,193 shares withheld for taxes upon the vesting of restricted stock units, valued between $207.31 and $229.08 per share, amounting to approximately $2,128,466. Following these transactions, Huston holds 217,714 shares directly.
These transactions were conducted under a Rule 10b5-1 trading plan, a pre-arranged plan that allows company insiders to sell stocks at predetermined times to avoid accusations of insider trading. The withheld shares were part of Huston's performance restricted stock unit award agreement with Carvana.
In other recent news, Carvana reported a remarkable third quarter in 2024, with record-setting financial performance. The company's net income reached $148 million, operating income totaled $337 million, and adjusted EBITDA hit $429 million. Carvana's retail unit sales increased by 34% year-over-year, contributing to a revenue surge of 32% to $3.655 billion. The company also repurchased $100 million of its 2028 senior secured notes, improving leverage ratios.
Carvana's management anticipates continued growth, projecting adjusted EBITDA significantly above the $1.0 billion to $1.2 billion range for the full year 2024. The company also plans to increase its advertising spend by $5 million to $10 million in the next quarter. However, a $10 million cash bonus for employees will impact Q4 adjusted EBITDA.
Additionally, the company is integrating ADESA assets to enhance efficiency and reduce shipping distances. These recent developments underline Carvana's strategic focus on operational excellence and market expansion. Despite an increase in SG&A expenses, the company's robust financial performance and growth strategy suggest a positive outlook.
InvestingPro Insights
As Carvana's COO Benjamin E. Huston sells shares, investors might be curious about the company's current financial standing and market performance. According to InvestingPro data, Carvana's market capitalization stands at an impressive $52.23 billion, reflecting significant investor confidence in the online used car retailer.
The company's recent performance has been nothing short of remarkable, with a staggering 781.42% price total return over the past year. This exceptional growth is further emphasized by the 332.72% year-to-date return, indicating strong momentum in 2024.
However, it's worth noting that Carvana's P/E ratio is currently at 1,600, suggesting a high valuation relative to earnings. This aligns with an InvestingPro Tip that the company is trading at a high earnings multiple. Despite this, analysts anticipate sales growth in the current year, which could potentially justify the premium valuation.
Another InvestingPro Tip reveals that Carvana has a perfect Piotroski Score of 9, indicating strong financial health and potential for future performance. This score, combined with the company's robust return metrics, may provide some reassurance to investors despite the recent insider selling activity.
For those seeking a deeper understanding of Carvana's financial position and market outlook, InvestingPro offers 20 additional tips, providing a comprehensive analysis for informed decision-making.
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