Carvana Co. (NYSE:CVNA) is flashing a warning signal for value-focused investors, dropping into the bottom 10th percentile of stocks for valuation even as its share price surges amid the S&P 500 index inclusion.

Check out CVNA’s stock price here.

Valuation Slides Into Bottom Percentile

While the stock has rallied by 24.04% over the last month on high hopes for Federal Reserve interest rate cuts, Benzinga Edge’s Stock Ranking data reveals that the company’s fundamentals are struggling to keep pace with its soaring market price.

The most critical shift in Carvana's profile is a week-on-week decline in its value score, which fell from 11.36 to 9.67.

According to Benzinga’s ranking methodology, the value score is a percentile-ranked composite that evaluates a stock’s worth by comparing ...