Carvana Drops 15% This Week: Here's The 3 Biggest Storylines

Core Viewpoint - Carvana's stock dropped 14.98% over the past week, driven by insider selling, negative social media sentiment, and competitive pressures in the used car market [1]. Insider Selling - Carvana's executives have been liquidating shares systematically, with CFO Mark Jenkins selling 12,058 shares and COO Benjamin Huston unloading 10,628 shares on February 2, 2026 [1]. - A pattern of coordinated selling has been observed, with multiple executives selling shares at similar prices, indicating a lack of confidence in the company's future [1]. - Notably, there have been no open-market purchases by executives recently, contrasting with 55 purchases made in the previous year [1]. Retail Investor Sentiment - Sentiment on Reddit turned bearish, with discussions around fraud allegations gaining traction, leading to a drop in sentiment scores from 18 to 10-12 [1]. - A post titled "Carvana $CVNA Fraud Comes To Light" received 153 upvotes, indicating growing concern among retail investors [1]. - Options traders are also positioning for downside, suggesting a bearish outlook among retail investors [1]. Competitive Landscape - Carvana's primary competitor, CarMax, also experienced a decline of 12.19% this week, indicating sector-wide pressures rather than company-specific issues [1]. - Carvana trades at a significantly higher valuation of 78x earnings compared to CarMax's 15x, which raises concerns about its ability to weather market challenges [1]. - Both companies are facing tightening consumer spending, but Carvana's high valuation leaves little room for error [1].