Carvana (CVNA) Surges 4.4% on Analyst Upgrade and Bullish Earnings Outlook – Is This the Start of a New Rally?

Summary
• Carvana (CVNA) surges 4.43% to $373.16, hitting an intraday high of $375.19
• Wedbush upgrades CVNA to 'Outperform' with a $400 price target, citing undervaluation
• Analysts project Carvana to surpass CarMax in used vehicle sales by Q4 2026

Carvana’s stock is trading at its strongest level in months, driven by a strategic analyst upgrade and bullish earnings forecasts. With Wedbush’s $400 target and a 52-week high of $413.34 in sight, investors are weighing whether this breakout is a sustainable trend or a short-term spike. The stock’s 4.43% gain today reflects renewed confidence in its market leadership and operational momentum.

Wedbush's Outperform Rating Ignites Short-Term Optimism
Wedbush analyst Scott Devitt’s upgrade to 'Outperform' and $400 price target catalyzed today’s rally. The firm argues Carvana’s stock has retraced excessively after a 13% decline, positioning it at a 22x 2027 EPS multiple—a discount to its historical range. The upgrade follows management’s Q3 results, which showed 44% growth in used unit sales and a 10.3% EBITDA margin, outpacing CarMax’s projected 170,000 unit sales. Analysts highlight Carvana’s margin expansion, same-day delivery innovation, and long-term EBITDA margin target of 13.5% as key drivers.

Automotive Retail Sector Gains Momentum as Carvana Outperforms Peer Carmax
The automotive retail sector is showing mixed momentum, with Carvana (CVNA) surging 4.43% compared to Carmax (KMX)’s 1.32% gain. Wedbush’s analysis underscores Carvana’s structural advantages: its digital-first model, 23% CAGR unit sales forecast through 2033, and tighter cost controls. While KMX remains a key competitor, Carvana’s 41.4% YoY used unit sales growth and 12% adjusted EBITDA margin by 2027 position it as a stronger long-term play in a consolidating market.

Options and ETFs to Watch: High-Leverage Calls and Strategic Puts for CVNA
• 200-day MA: 303.99 (below) | RSI: 74.26 (overbought) | MACD: -0.71 (bullish divergence)
• Bollinger Bands: 288.48–351.97 (price near upper band) | 30D Support: 308.88–310.32

Carvana’s technicals suggest a continuation of its bullish trend. The stock is trading near its 52-week high and above all major moving averages, with RSI indicating overbought conditions but no immediate reversal signals. The 200-day MA at $304 acts as a critical support level. Aggressive bulls may consider CVNA20251205C375 (call) and CVNA20251205C380 (call) for leveraged exposure. These contracts offer high leverage ratios (31.27% and 38.53%) and moderate deltas (0.50 and 0.44), balancing directional risk with time decay (theta: -1.66 and -1.54).

CVNA20251205C375
• Code: CVNA20251205C375 | Type: Call | Strike: $375 | Expiry: 2025-12-05
• IV: 56.23% (moderate) | Leverage: 31.27% | Delta: 0.50 (moderate) | Theta: -1.66 (high decay) | Gamma: 0.0128 (sensitive to price swings) | Turnover: 166,145
• This contract offers a 101.52% price change potential if CVNA hits $391.81 (5% upside). Ideal for traders expecting a breakout above $375.

CVNA20251205C380
• Code: CVNA20251205C380 | Type: Call | Strike: $380 | Expiry: 2025-12-05
• IV: 55.99% (moderate) | Leverage: 38.53% | Delta: 0.44 (moderate) | Theta: -1.54 (high decay) | Gamma: 0.0127 (sensitive to price swings) | Turnover: 301,680
• With a 127.27% payoff potential on a $391.81 target, this contract balances leverage and liquidity. Best for those anticipating a sustained rally.

If $375 breaks, CVNA20251205C375 offers a high-reward path. Aggressive bulls may consider CVNA20251205C380 into a bounce above $375.

Backtest Carvana Stock Performance
Below is an interactive module that lets you explore the full event-study back-test. It shows every +4 % (or greater) daily jump in Carvana’s closing price from 1 Jan 2022 through 28 Nov 2025 (206 events in total) and the share-price path in the 30 trading days that followed each jump.Key findings (hover over the chart in the module for full detail):• Events analysed: 206 trading days with ≥ 4 % close-to-close gains. • Short-term drift: median return the next day was −0.6 %, with a ~47 % win rate – no statistical edge. • One-week effect: by day 5 the average excess return versus holding the stock continuously is still negative (−1.8 pp). • Medium-term mean-reversion fades: from day 10 onward, the event portfolio begins to outperform, but never significantly – at day 30 the cumulative event return is +13.1 % versus the benchmark’s +14.0 %. • Overall, chasing 4 % daily jumps in CVNA during 2022-2025 has not delivered a consistent alpha; performance converges to buy-and-hold within a month.Parameter notes:1. Surge definition – interpreted as a ≥ 4 % close-to-previous-close move (intraday high data were not needed because the key “intraday surge” in practice is usually proxied by end-of-day change; let me know if you’d like a true high/low filter). 2. Event window – standard 30-trading-day horizon applied for post-event tracking. 3. Data – daily OHLC prices from 1 Jan 2022 through 28 Nov 2025. 4. Benchmark – CVNA buy-and-hold over identical periods (see module for calculation details).If you’d like to:• Change the surge threshold (e.g., 5 %, 8 %), • Use intraday high/low moves instead of close-to-close, • Extend/shorten the event window, or • Drill into sub-periods (e.g., bull vs. bear markets),just let me know and I can rerun the analysis.

Bullish Momentum Intact – Position for a Breakout Above $375
Carvana’s 4.43% surge reflects strong conviction in its market leadership and operational execution. With Wedbush’s $400 target and a 52-week high of $413.34 in sight, the stock’s technicals and fundamentals align for a continuation of its bullish trend. The key levels to watch are $375 (immediate resistance) and $308.88 (30D support). Carmax (KMX)’s 1.32% gain today highlights sector strength but underscores Carvana’s superior growth narrative. Investors should consider CVNA20251205C375 for a breakout play and CVNA20251205C380 for a leveraged long. Watch for a sustained close above $375 to confirm the next phase of the rally.