Form 4: Carvana Director Ernest Garcia II Sells Shares Under 10b5-1 Trading Plan

Ernest Garcia II, a director and significant shareholder of Carvana Co. (CVNA), executed multiple sales of Class A Common Stock on June 14 and June 17, 2024, under a pre-arranged Rule 10b5-1 trading plan.

Summary

• Ernest Garcia II, a director and 10% owner of Carvana Co., sold shares of Class A Common Stock on June 14 and June 17, 2024.
• The sales were executed under a Rule 10b5-1 trading plan adopted on March 11, 2024.
• On June 14, 2024, Garcia sold 20,041 shares at a weighted average price of $101.9431, 20,641 shares at $102.9187, 17,423 shares at $103.7532, 995 shares at $104.9311, and 900 shares at $105.51.
• On June 17, 2024, Garcia sold 6,330 shares at a weighted average price of $100.6195, 10,200 shares at $101.5822, 2,370 shares at $102.4174, 6,878 shares at $103.5591, 9,143 shares at $104.5035, 3,163 shares at $105.4494, 1,703 shares at $106.5564, 7,202 shares at $107.7542, 12,401 shares at $108.5617, and 610 shares at $109.2865.
• Following these transactions, Garcia directly owns 41,442,317 shares of Class B Common Stock and indirectly owns shares through various entities and trusts.
• These entities include Verde Investments, Inc., Ernest Irrevocable 2004 Trust III, ECG II SPE, LLC and Ernest C. Garcia III Multi-Generational Trust III.
• Garcia also indirectly owns Class A Units exchangeable for Class A Common Stock through these entities.

Sentiment

Score: 5

Explanation: The sentiment is neutral. It's a routine filing related to pre-planned stock sales. The market reaction will depend on the overall context and investor perception of the company's prospects.

Risks

• Sales by insiders, even under pre-arranged plans, can sometimes be perceived negatively by the market.

Industry Context

Insider sales are a common occurrence in publicly traded companies. The use of a 10b5-1 trading plan allows insiders to sell shares over a period of time while avoiding concerns about trading on non-public information. The market will often scrutinize the reasons behind such sales, especially in companies with volatile stock prices.

Stakeholder Impact

• The sales could have a minor negative impact on shareholder sentiment if investors interpret the sales as a lack of confidence by the director, although the existence of a pre-arranged trading plan mitigates this concern.

Key Dates