Why did CVNA stock drop about 20% today?

Shares fell after Carvana’s adjusted EBITDA of $511 million and a 10.1% margin missed estimates of $535.7 million and 10.4%. Management also offered a vague Q1 outlook and flagged higher reconditioning costs into Q1, which raised margin risk and pushed investors to reset near-term expectations.

Is the adjusted EBITDA miss a red flag for Carvana earnings?

It is a caution signal, not a thesis breaker by itself. The miss was modest in dollars, but it questioned near-term margin traction. The bigger watch item is management’s cost commentary. If reconditioning expenses fade and per-unit metrics improve, earnings power can still trend higher.

What should investors watch in Q1 after this report?

Track gross profit per unit, reconditioning turnaround, SG&A per unit, and financing spreads. Monitor inventory days and sell-through. Any update showing cost relief and stable demand would support margins. If costs stay elevated and unit economics weaken, estimates may need to move lower.

Is CVNA stock attractive after the pullback?

Valuation is still premium at roughly 80x trailing EPS and about 4.3x sales. Oversold readings hint at bounce risk, but sustained upside likely needs clearer cost normalization and steady margins. Consider phased entries and defined risk levels while watching Q1 profitability signals.

Global Market Insights

CVNA Stock Today: February 18 — 20% Plunge After EBITDA Miss, Vague Outlook

ByHuzaifa Zahoor February 19, 2026February 19, 2026

CVNA stock fell about 20% today after Carvana earnings showed strong revenue and unit sales but an adjusted EBITDA miss and a vague outlook. Q4 adjusted EBITDA was $511 million with a 10.1% margin, below estimates of $535.7 million and 10.4%. Management flagged higher retail reconditioning costs into Q1, which may pressure margins. With the Street modeling about $671 million for Q1 EBITDA, investors reassessed near-term expectations and risk. We explain what moved shares, key metrics, and what to watch now.