Form 4: Carvana Director and 10% Owner Ernest Garcia II Reports Significant Share Sales Under Pre-Planned Trading Plan

Ernest C. Garcia II, a Director and 10% owner of Carvana Co., reported the conversion of Class A Units into Class A Common Stock and subsequent sales totaling 54,971 shares, executed under a Rule 10b5-1 trading plan.

Summary

• Ernest C. Garcia II, a Director and 10% owner of Carvana Co., reported multiple transactions involving Carvana securities on June 24 and June 25, 2025.
• On June 24, 2025, Mr. Garcia converted 62,500 Class A Units of Carvana Group, LLC into 50,000 shares of Carvana Co. Class A Common Stock.
• Concurrently, he sold a total of 50,000 Class A Common Stock shares on June 24, 2025, at weighted average prices of $325.4713 (33,265 shares), $326.4543 (16,202 shares), and $327.1244 (533 shares).
• In connection with the conversion, 50,000 shares of Class B Common Stock were cancelled for no consideration.
• On June 25, 2025, Mr. Garcia converted an additional 6,214 Class A Units into 4,971 shares of Class A Common Stock.
• He then sold all 4,971 Class A Common Stock shares on June 25, 2025, at a weighted average price of $325.1499.
• An additional 4,971 shares of Class B Common Stock were cancelled on June 25, 2025, due to the conversion.
• All reported sales were executed pursuant to a pre-arranged Rule 10b5-1 trading plan adopted on December 13, 2024.
• Following these transactions, Mr. Garcia directly owns 0 Class A Common Stock, 36,837,346 Class B Common Stock, and 46,046,681 Class A Units.
• ECG II SPE, LLC, an entity wholly owned and controlled by Mr. Garcia, indirectly owns 8,000,000 Class B Common Stock and 10,000,000 Class A Units (exchangeable for 0.8 Class A Shares).

Sentiment

Score: 5

Explanation: The sentiment is neutral. While insider selling can sometimes be viewed negatively, the fact that these sales were conducted under a pre-arranged Rule 10b5-1 plan mitigates immediate negative implications, suggesting a planned liquidity event rather than a reaction to adverse company news.

Positives

• The sales were conducted under a pre-arranged Rule 10b5-1 trading plan, indicating a systematic approach to liquidity rather than a reaction to immediate negative news.

Negatives

• Significant insider selling by a director and 10% owner, even if pre-planned, can sometimes be perceived negatively by investors as it reduces the insider's direct equity stake in the company's Class A Common Stock.

Risks

• The document itself does not detail specific risks beyond the inherent nature of insider transactions. The primary risk from an investor perspective is the potential negative market perception of significant insider selling, regardless of the 10b5-1 plan.

Future Outlook

The document is a transactional report and does not contain forward-looking statements or guidance regarding Carvana Co.'s future performance or strategic outlook.

Industry Context

This Form 4 filing reports routine insider transactions for Carvana Co. and does not provide broader industry context or trends. It reflects an individual's pre-planned equity management strategy rather than a company-wide strategic announcement.

Comparison to Industry Standards

• This document, an SEC Form 4, reports specific insider transactions and does not contain information suitable for comparison to global industry benchmarks, comparable companies, projects, or results.

Related Party Transactions

• The reported transactions involve Ernest C. Garcia II, a Director and 10% owner of Carvana Co., and ECG II SPE, LLC, an entity wholly owned and controlled by Mr. Garcia, making these related-party transactions.
• The transactions include the conversion of Class A Units of Carvana Group, LLC (a related entity) into Class A Common Stock of Carvana Co.

Stakeholder Impact

• Shareholders: The sale of Class A Common Stock by a significant insider could lead to a perception of reduced confidence, although the 10b5-1 plan mitigates this. It also represents a slight increase in the public float of Class A shares.
• Employees, Customers, Suppliers, Creditors: The transactions are unlikely to have a direct or material impact on these stakeholders as they relate to personal equity management by an insider, not operational or financial changes for the company.

Next Steps

• The document does not specify any future actions, events, or milestones for the company or the reporting person beyond the completion of these reported transactions.

Key Dates

Recommendation

Keywords

Carvana Co., CVNA, SEC Form 4, Insider Trading, Ernest C. Garcia II, Stock Sales, Rule 10b5-1 Plan, Class A Common Stock, Class B Common Stock, Carvana Group LLC, Equity Conversion, Director Transactions, 10% Owner