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Avis, CarMax, and Carvana: 3 Car Stocks Sharply Diverge

Reported by Leo Miller. Published: 4/20/2026.

Car rental and used-car stocks are showing a wide divergence in performance. Three notable names in these industries are Avis Budget Group (NASDAQ: CAR), CarMax (NYSE: KMX), and Carvana (NYSE: CVNA). Their 52-week returns range from drops of about 30% to gains approaching 500%. Here’s what’s driving the differences and what Wall Street analysts are saying next.

Avis Catapults on Suspected Short Squeeze

Over the past 52 weeks, Avis Budget Group has gained more than 450% and is approaching the 500% mark. Since the end of March, Avis shares have risen more than 200%, including nine single-day gains of 10% or more. Analysts largely attribute the explosive run to a short squeeze.

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Short squeezes occur when a large share of a company’s float is sold short. If the stock rises, short sellers buy shares to cover positions and limit losses, which in turn pushes the price higher and forces further covering.

At the end of March, short interest was roughly 54% of Avis’s float — an extremely high level and a classic setup for a squeeze. More recent reports show short interest has since increased to about 58%, suggesting new traders are entering short positions even as the stock climbs.

Speculating on short squeezes is risky. Stocks driven by technical trading dynamics can fall as quickly as they rise because fundamentals often don’t support the elevated valuations.

For example, Avis’s revenue fell about 1% in 2025, yet the stock trades at a forward price-to-earnings ratio near 130x. Wall Street analysts remain largely bearish: the MarketBeat consensus price target of $115 implies roughly 75% downside from current levels.

CarMax Sees Big Losses Amid CEO Departure, Falling Sales

Used-car reseller CarMax is down more than 30% over the past year and has recorded several large single-day drops. One notable move was a 24% one-day decline in November 2025 after CarMax announced its CEO would step down and the company issued weak guidance.

The company warned comparable sales would fall 8% to 12% in its Q3 fiscal 2026 (CarMax’s fiscal periods run ahead of the calendar year). It also provided an EPS range of $0.18 to $0.36. Analysts had expected a comparable-sales decline of about 3% and EPS above $0.60. CarMax ultimately reported a comparable-sales decline of 9% and EPS of $0.43.

Both results were better than the company’s midpoint guidance, but the stock still fell. Even after CarMax reported beats in April 2026, shares dropped another 15%, reflecting continued investor skepticism about the company’s longer-term outlook.

Analysts reflect that uncertainty. The MarketBeat consensus price target of $41.21 suggests the stock is roughly fairly valued, but targets revised after the latest earnings report average about $35.50 — implying more than 10% downside.

Carvana Grows Car Sales by 43% as CarMax Declines

CarMax’s struggles have coincided with Carvana’s rapid growth. CVNA is up more than 80% over the past 52 weeks as the company grabs market share from legacy resellers. In 2025, Carvana sold 596,641 cars to retail customers, up 43% year over year. By contrast, CarMax sold 780,684 cars to consumers in FY2026, a 1.1% decline year over year. One year earlier, Carvana sold 416,348 retail vehicles versus CarMax’s nearly 789,050 — underscoring Carvana’s rapid customer growth while CarMax’s volumes have slipped.

Unlike CarMax, which operates more than 250 traditional showrooms, Carvana has no physical stores. Buying and selling happens entirely online: Carvana acquires vehicles from sellers, refurbishes them, and delivers them to buyers. That model appears to be resonating with many customers.

Analysts are moderately bullish on Carvana. The MarketBeat consensus price target near $435 implies roughly 10% upside. However, several April target updates are lower — the average of April revisions sits around $411 (about 5% upside) — and individual targets range from $335 to $475. Carvana was set to report Q1 2026 results in late April, which could meaningfully shift those estimates.

Avis Stands Alone, CarMax and Carvana Jockey for Share

Avis’s rally appears driven mainly by technical factors rather than a fundamental repositioning in the rental market. By contrast, CarMax and Carvana represent opposite ends of the same story: Carvana’s online-first model is disrupting the traditional used-car reseller market and winning customers.

Carvana also lays out ambitious long-term goals. The company aims to reach 3 million annual retail vehicle sales sometime between 2030 and 2035, which would require sustained annual growth roughly in the 18%–38% range.