Carvana Co. (CVNA): fair value, margin of safety and Wheel Score

Is CVNA undervalued?

Carvana Co. (CVNA) closed at 60.59 on 16 Oct 2026, close to the GLS average fair value of 56.99 (6.3% above fair value). 2 of the 6 models that produced a number sit above the price, 4 below - the market and our models roughly agree. With little margin of safety either way, the case for or against the stock rests on the quality numbers and the option premium rather than on price.

The 6 models disagree widely: Graham Number gives 16.61 while GLS Growth gives 133.75. A spread that wide means the average is sensitive to which methods you trust; the model table below shows where each one lands, and the Quote page lets you switch any of them off.

The nightly engine files CVNA under High Growth: revenue and earnings growing fast enough that the growth-based models carry the valuation.

Nine valuation models for CVNA

Each model turns the latest filed numbers into a value per share; the GLS fair value is the simple average of the ones that produce a positive number. The last two rows are shown for reference and never enter the average. The Quote page lets you switch any model off and add your own margin of safety.

Quality and financial health

Financial health is average - CVNA passes 5 of the nine Piotroski tests, which falls one point short of the Sunday Scan's "6 or more" rule. The Financials tab on the Quote page shows which tests fail. The GLS Moat score is low at 3.5 out of 10, which says the ten-year record of revenue, earnings, margins and returns on capital has been inconsistent - growth and shocks rather than steady compounding.

Returns on capital are high - ROIC 15.7%, ROE 40.9%, ROA 10.7% - with debt at 1.60 times equity and a free-cash-flow yield of 1.4%.

Carvana Co. pays no dividend, so the DDM model does not apply and a covered-call holder earns only the premium and any price gain. Revenue comes mainly from Used Vehicle Sales 91%, Product and Service, Other 9% (quarter Q2 FY2026).

Institutional ownership scores 10/10, insider activity 1/10 and Congressional trading 9/10 on the GLS smart-money scales; the last recorded Congressional buy was on 11 Sep 2026.

Wheel Score 55: Fair

CVNA scores 55 out of 100 on the Wheel Score (Fair band, 50-64): a usable but unremarkable fit for the wheel strategy. The parts: Value 10/25, Health 11/20, Moat 5/15, Premium 15/20, Stability 14/20. Moat (5/15) is where the points are missing.

Implied volatility is 81% on the near-the-money contracts 20-60 days out - above the 60% ceiling of the sweet spot. Premiums are large, but the Wheel Score tapers the Premium points (15 of 20) because volatility this high usually comes with a reason. The option chain is deep: 747,985 contracts of open interest across all expiries, which means tight fills at most strikes.

Volume runs at 13.2M shares a day on a market cap of $66.5B, with a beta of 3.55 - a high beta, so the stock tends to move more than the market and a strike can be gapped through; the Stability part of the Wheel Score gives that 14 of 20.

The Wheel Score ranks ~7,400 US stocks for selling cash-secured puts and covered calls; it is updated nightly and is not a recommendation. The walkthrough lesson shows how the score fits into a trade, start to finish.

Upcoming events

Carvana Co. reports earnings on 28 Oct 2026 (after the close) - inside the 14-day window the Sunday Scan avoids, because a put sold now would carry the report's gap risk.

Earnings, dividend, IPO, split and economic calendars for the whole market, filterable to your watchlists.

Similar stocks in Auto - Dealerships

The 12 companies below are the closest to Carvana Co. by market cap within the Auto - Dealerships industry, each with its own fact sheet; the Compare page puts up to eight of them side by side.

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