New York, Jan 30, 2026, 21:04 EST — Market closed.
Carvana Co. shares dropped 6.2% on Friday, closing at $401.11, capping a tough week filled with headline-driven volatility for the online used-car seller. (Yahoo Finance)
The slide is a big deal now since the stock’s rally has hinged on a turnaround story and steady funding linked to auto loans. A short-seller’s attack can shake both pillars, prompting traders to eye Monday’s open closely for signs of forced selling or a swift recovery.
Gotham City Research took aim at Carvana this week, claiming the company overstated profits by roughly $1 billion for 2023 and 2024. The allegations focus on transactions involving Ernest Garcia II and his son, Ernest Garcia III. This report follows earlier digs by Hindenburg Research and investor Jim Chanos, Investopedia noted. (Investopedia)
Carvana pushed back against the allegations, labeling the report “inaccurate and intentionally misleading,” and insisted its related-party transactions had been fully disclosed, the Financial Times reported. (Financial Times)
The short seller also targeted Carvana’s method of recognizing gains from selling customer loans, suggesting the company might be booking profits immediately while losses show up elsewhere in the system, according to a Nasdaq.com article. (Nasdaq)
On Wall Street, analysts were quick to strike back. JPMorgan’s Rajat Gupta called the report a “significant misrepresentation of facts.” BTIG’s Marvin Fong flatly disagreed with several key calculations. Sharon Zackfia of William Blair highlighted Carvana’s scale and strong customer appeal, according to Investing. (ABS, or asset-backed securities, are bonds secured by pools of auto loans.)
Friday’s trading was volatile. The stock kicked off at $425.21, hit a peak of $427.50, then dipped to a low of $396.61. Volume came in around 3.8 million shares, per Yahoo Finance historical data. (Yahoo Finance)
Other used-car stocks dipped, with CarMax among the decliners. Carvana trailed both ACV Auctions and Openlane, according to MarketWatch data. (MarketWatch)
The battle isn’t only over Friday’s closing price. If the report keeps making rounds or attracts regulators’ scrutiny, investors might begin factoring in steeper funding costs for Carvana’s loan engine — squeezing margins even if sales volumes stay steady.
Carvana’s fourth-quarter and full-year results drop Feb. 18 after the market closes. Management will hold a conference call at 5:30 p.m. ET. (Carvana)
