Carvana (CVNA) Stock: Used-Car Retailer Joins S&P 500 After 97% YTD Gain

TLDR

• Carvana will join the S&P 500 on December 22, 2025, replacing LKQ Corp in the quarterly rebalance
• CVNA stock jumped 10% in after-hours trading following the announcement on Friday
• Shares have rallied 97% year-to-date and gained 10,000% from 2022 lows of under $4
• Q3 earnings showed $1.03 GAAP EPS (up 61% year-over-year) and revenue of $5.65 billion (up 55%)
• CRH and Comfort Systems USA will also join the index in the same rebalance

Carvana stock surged in after-hours trading Friday after S&P Dow Jones Indices announced the online used-car retailer will join the S&P 500. The move caps a turnaround story for the ages.

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The Tempe, Arizona-based company will enter the benchmark index on December 22. LKQ Corp, Solstice Advanced Materials, and Mohawk Industries will exit to make room for Carvana and two other new entrants.

Shares jumped about 10% to $439 after the announcement. The stock closed regular trading at $399.77 on Thursday.

The addition marks a major milestone for a company that traded below $4 per share in 2022. That’s a 10,000% gain in roughly three years. The recovery came through aggressive cost-cutting and debt restructuring efforts.

Year-to-date performance shows CVNA up 97%. The rally reflects improving fundamentals across the business.

Third-quarter results backed up the momentum. Carvana reported GAAP earnings per share of $1.03, beating expectations. Revenue hit $5.65 billion, up 55% from the prior year.

The company sold a record 156,000 vehicles in Q3. That volume helped drive margins higher and showed used-car demand recovering.

What S&P 500 Inclusion Means

Getting into the S&P 500 typically triggers automatic buying. Index funds and ETFs tracking the benchmark must purchase shares of new additions.

Both passive and active funds that follow the index will need to add Carvana to their portfolios. This creates immediate demand for the stock.

Companies must meet strict criteria to qualify. They need market caps above $22.7 billion and must show profitability in recent quarters. Carvana cleared these hurdles after years of losses.

Excluding warrant impacts, adjusted EPS came in at $1.50 per share in Q3. Analysts had projected $1.30 on revenue of $5.11 billion.

Two Other Companies Join the Index

CRH, a global building materials provider, will also join the S&P 500 in the December rebalance. Its shares rose over 7% in post-market trading after the news.

Comfort Systems USA, an HVAC installation and services company, rounds out the three additions. FIX stock climbed about 2% after hours.

The changes help the S&P 500 maintain sector balance and reflect current market trends. The index committee reviews composition quarterly.

Bloomberg Intelligence analysts had predicted these three companies as strong candidates earlier in the week. Analyst Wendy Soong noted Carvana adds sector diversification and meets all inclusion criteria.

Wall Street maintains a Strong Buy rating on CVNA stock. Sixteen analysts rate it a Buy while three say Hold. The average price target sits at $432.67.

Carvana’s long-term goals remain ambitious. The company wants to sell 3 million cars annually at a 13.5% adjusted EBITDA margin within five to ten years.

Management stated this guidance assumes a stable economic environment. The Q3 results showed progress toward these targets with improving margins and growing sales volume.

Matt Maley, chief market strategist at Miller Tabak + Co., noted that stock moves from inclusion announcements often prove short-lived. Demand spikes initially but typically subsides once the stock enters the index.

The effective date for all changes is December 22, prior to the market open. Index funds will need to complete their purchases before that date.

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