December 20, 2025 — Carvana Co. (NYSE: CVNA) is heading into the final full trading week of the year with unusual momentum — and unusual scrutiny. Shares last closed at $450.22, down 3.33% on Friday, December 19, after swinging through a wide intraday range as traders positioned around index flows and fresh analyst calls. [1]
The headline catalyst now has a firm date: Carvana is scheduled to join the S&P 500 effective before the open on Monday, December 22, as part of the quarterly rebalance. [2] That inclusion has kept Carvana stock in the center of “index effect” conversations all month — and it’s arriving after one of the most dramatic turnarounds in recent U.S. consumer stock history.
Below is what’s driving the story as of Dec. 20, 2025, including today’s newly published analyses, the latest forecasts, and the main issues bulls and bears are watching into Dec. 22 and beyond.
What’s new on Dec. 20: the weekend “forecast stack” turns bullish — with big valuation caveats
Several widely circulated stock-focused outlets published Carvana-focused pieces on Dec. 20, and while the angles differ, they converge on the same theme: the market is pricing Carvana like a long-duration winner again — and the next few weeks may test whether that confidence is justified.
1) “Valuation vs. growth” lens: P/S ratio and revenue growth assumptions
A Dec. 20 analysis from Simply Wall St highlights how far expectations have moved: it points to Carvana’s price-to-sales ratio around 3.5x versus many specialty retail peers below 0.5x, arguing the premium hinges on forecasts that Carvana’s revenue can grow ~26% per year over the next three years (versus an industry forecast of ~7.9%). [3]
That’s the core bull case in one sentence: Carvana is priced as a market-share compounder, not a cyclical used-car dealer.
2) “Who’s selling?” lens: institutional trimming + insider sales
A separate Dec. 20 MarketBeat filing-driven recap adds a more cautious note, emphasizing ownership moves and insider activity. It says Assenagon Asset Management cut its stake by 56.5% in Q3 and flags “heavy insider selling,” including specific disclosed transactions and an aggregate figure of 594,332 shares sold worth ~$240.1 million over the past 90 days (per the report’s summary of filings). [4]
Insider selling doesn’t automatically mean “bearish” — executives diversify all the time — but in a stock with a steep valuation and high volatility, it’s the kind of data point that can change sentiment fast.
3) “Analyst narrative” lens: Buy ratings meet index inclusion
Meanwhile, the weekend also revived the “new coverage + index inclusion” storyline. Reuters earlier framed Carvana’s S&P 500 entry as the capstone to a three‑year turnaround, noting the stock’s surge from 2022 lows and highlighting the expected demand from passive index trackers. [5]
The big catalyst: Carvana’s S&P 500 inclusion on Dec. 22
S&P Dow Jones Indices’ rebalance notice states that Carvana (CVNA) will be added to the S&P 500 effective prior to the open on Monday, Dec. 22, 2025. [6]
Why that matters for Carvana stock:
- Passive demand: Funds that track the S&P 500 may need to buy shares to match the index, which can create short-term incremental demand. Reuters specifically described the inclusion as likely to spur purchases by index-tracking funds. [7]
- Liquidity and “institutional legitimacy”: S&P 500 membership can broaden the investor base (and research coverage) even if the stock already trades heavily.
- Volatility risk: The “index effect” can cut both ways — flows can be front‑run, crowded, or partially priced in before the effective date.
Carvana’s trading action into the rebalance has already looked “event-driven.” Friday’s pullback — despite the broader market strength — underlines how sensitive CVNA can be to positioning and profit-taking. [8]
Analyst calls and price targets: $450 to $500 is now the fight zone
Carvana’s latest coverage cycle is notable not just for upgrades — but for how tightly clustered the “bull” targets have become around the $450–$500 region, right where the stock is trading today.
Wedbush lifts its target to $500
A note distributed via TheFly/TipRanks reports Wedbush analyst Scott Devitt raised Carvana’s price target to $500 from $400 and maintained an Outperform rating. [9]
Argus initiates coverage with a $500 target
An Argus initiation summary carried by Investing.com states Argus initiated coverage with a Buy rating and a $500 price target, and also describes a broader analyst target range cited in that piece of $330 to $550. [10]
UBS launches with a $450 target — and a market-share thesis
UBS’s initiation has been influential in the narrative because it frames Carvana as a “disruptor” with a long runway: one summary notes UBS initiated with a Buy and a $450 target, and argues Carvana can expand market share over time (from a low single-digit base) as online penetration grows. [11]
But the consensus now implies limited upside from here
Even with multiple bullish $500 targets in the mix, consensus math is getting tougher. MarketBeat’s Dec. 20 recap highlights a “Moderate Buy” consensus and an average price target around $446.09 — effectively flat to slightly below where CVNA trades today. [12]
Translation: Wall Street is increasingly positive on the story, but the stock’s rally means many targets are catching up rather than leading.
The fundamentals behind the surge: record Q3 results and profitability milestones
Carvana’s rally isn’t just “meme-stock reflex.” The company has delivered measurable operating improvements — and those results are central to why index inclusion and analyst upgrades have had such force.
In its Q3 2025 release, Carvana reported:
- 155,941 retail units sold (up 44% year over year)
- Revenue of $5.647 billion (up 55% year over year)
- Net income of $263 million
- Adjusted EBITDA of $637 million
- An outlook calling for Q4 retail units above 150,000, and full-year 2025 Adjusted EBITDA at or above the high end of its $2.0–$2.2 billion range (assuming a stable environment) [13]
Reuters also highlighted the quarter’s profit and revenue growth and connected demand strength to broader auto affordability dynamics, noting revenue rose 54.5% year over year to about $5.65 billion. [14]
Those numbers matter because they underpin the market’s willingness to value Carvana as a scalable platform rather than a fragile balance-sheet story.
Forecast debate: can Carvana really take the crown from CarMax?
The most aggressive “blue-sky” forecast in the Carvana narrative is that it could surpass CarMax in used-car unit volumes on a quarterly basis — essentially becoming the category’s volume leader.
- Reuters reported that an analyst suggested Carvana could overtake CarMax in quarterly used-car sales volumes by Q4 2026. [15]
- Other coverage has echoed similar themes, pointing to competitive momentum and the possibility of faster share gains if online purchasing continues to normalize. [16]
Whether that timeline proves right is one of the key swing variables for the stock, because “winner-takes-more” expectations are already embedded in today’s valuation.
Valuation check: why CVNA bulls and bears are talking past each other
Carvana’s valuation has become the most polarizing part of the story — and it’s not close.
The bullish framing: pay up for a category winner
The bull thesis is straightforward: Carvana’s vertically integrated model, logistics footprint, and improving profitability create a path to sustained growth. That’s the logic behind high revenue growth assumptions like those cited in the Dec. 20 valuation commentary. [17]
The bearish framing: a lot is priced in
Reuters put the valuation debate in stark terms earlier this month, noting Carvana’s market value reached roughly $97 billion and that the stock traded at 57.4 times forward earnings, far above Detroit automakers’ single-digit multiples. [18]
Market data around today’s close also reflects how “expensive” the equity looks on traditional metrics, with CVNA around a $98B market cap and triple‑digit P/E readings depending on the dataset used. [19]
Why this matters for investors: When a stock trades at a premium, execution mistakes are punished faster — and even good news can be met with “sell the fact” reactions if expectations are too high.
Ownership and insider activity: the signal investors are parsing right now
Two ownership dynamics are shaping sentiment into year-end:
- Institutional positioning
MarketBeat’s Dec. 20 filing recap says roughly 56.71% of shares are held by institutional investors and notes a major fund reducing its position during Q3. [20] - Insider selling headlines
The same recap highlights insider sales over the past 90 days (with named transactions and an aggregate figure). [21]
In practical trading terms, these data points can act like accelerants: in a high-beta stock, they can intensify either “this is distribution” fears or “this is routine liquidity” rebuttals — depending on the tape.
What to watch next week: Dec. 22 flows, liquidity, and the first “post-inclusion” test
With markets closed today (Saturday), the next major moment for CVNA is Monday, December 22, when the S&P 500 change becomes effective prior to the open. [22]
Here are the near-term markers that could decide whether the inclusion is a new leg higher — or a volatility event:
- Opening week flows: how aggressively index-linked buying shows up versus how much was pre-positioned.
- Volume + spread behavior: whether liquidity improves (often a positive signal) or whether the stock becomes “crowded” and whippy.
- Follow-through after the event: many event-driven trades fade quickly; a strong post-event base would be a constructive signal for bulls.
Bottom line on Carvana stock as of Dec. 20, 2025
Carvana enters the Dec. 22 S&P 500 addition with:
- A powerful catalyst (index inclusion) formally scheduled and widely discussed [23]
- A cluster of bullish analyst targets at $450–$500, including fresh reiterations and initiations that keep the narrative alive into year-end [24]
- Hard operating momentum from record Q3 unit and revenue performance and a profitability outlook management reiterated for 2025 [25]
- A valuation that leaves little room for disappointment, with even consensus targets suggesting the easy upside may already be captured [26]
References
1. www.marketwatch.com, 2. press.spglobal.com, 3. simplywall.st, 4. www.marketbeat.com, 5. www.reuters.com, 6. press.spglobal.com, 7. www.reuters.com, 8. www.marketwatch.com, 9. www.tipranks.com, 10. www.investing.com, 11. www.marketwatch.com, 12. www.marketbeat.com, 13. investors.carvana.com, 14. www.reuters.com, 15. www.reuters.com, 16. www.investopedia.com, 17. simplywall.st, 18. www.reuters.com, 19. www.marketbeat.com, 20. www.marketbeat.com, 21. www.marketbeat.com, 22. press.spglobal.com, 23. press.spglobal.com, 24. www.tipranks.com, 25. investors.carvana.com, 26. www.reuters.com
