With Carvana Stock Sliding, Have You Assessed The Risk?
Carvana (CVNA) stock is down 14.2% in a day. The recent slide reflects renewed concerns around alleged profit inflation via related-party transactions and accounting irregularities, but sharp drops like this often raise a tougher question: is the weakness temporary, or a sign of deeper cracks in the story?
Before judging its downturn reslience, let’s look at where Carvana stands today.
- Size: Carvana is a $57 Bil company with $18 Bil in revenue currently trading at $410.04.
- Fundamentals: Last 12 month revenue growth of 45.5% and operating margin of 9.4%.
- Liquidity: Has Debt to Equity ratio of 0.1 and Cash to Assets ratio of 0.27
- Valuation: Carvana stock is currently trading at P/E multiple of 90.8 and P/EBIT multiple of 34.5
- Has returned (median) 205% within a year following sharp dips since 2010. See CVNA Dip Buy Analysis.
These metrics point to a Strong operational performance, alongside Very High valuation – making the stock Relatively Expensive. For details, see Buy or Sell CVNA Stock
That brings us to the key consideration for investors worried about this fall: how resilient is CVNA stock if markets turn south? This is where our downturn resilience framework comes in. Suppose CVNA stock falls another 20-30% to $287 – can investors comfortably hold on? Turns out, the stock has fared worse than the S&P 500 index during various economic downturns, based on (a) how much the stock fell and, (b) how quickly it recovered. Below, we dive deeper into each such downturn.
2022 Inflation Shock
- CVNA stock fell 99.0% from a high of $370.10 on 10 August 2021 to $3.72 on 27 December 2022 vs. a peak-to-trough decline of 25.4% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 31 July 2025
- Since then, the stock increased to a high of $478.45 on 22 January 2026 , and currently trades at $410.04
| CVNA | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -99.0% | -25.4% |
| Time to Full Recovery | 947 days | 464 days |
2020 Covid Pandemic
- CVNA stock fell 73.3% from a high of $110.09 on 21 February 2020 to $29.35 on 20 March 2020 vs. a peak-to-trough decline of 33.9% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 5 June 2020
| CVNA | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -73.3% | -33.9% |
| Time to Full Recovery | 77 days | 148 days |
2018 Correction
- CVNA stock fell 57.9% from a high of $70.82 on 11 September 2018 to $29.84 on 21 December 2018 vs. a peak-to-trough decline of 19.8% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 30 April 2019
| CVNA | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -57.9% | -19.8% |
| Time to Full Recovery | 130 days | 120 days |
Feeling jittery about CVNA stock? Consider portfolio approach.
Stock Picking Falls Short Against Multi Asset Portfolios
Single markets are unpredictable but different assets react differently. A multi asset portfolio cuts downside shocks while keeping upside on the table.
The asset allocation framework of Trefis’ Boston-based, wealth management partner yielded positive returns during the 2008-09 period when the S&P lost more than 40%. Our partner’ strategy now includes Trefis High Quality Portfolio, which has a track record of comfortably outperforming its benchmark that includes all 3 – the S&P 500, S&P mid-cap, and Russell 2000 indices