CarMax (NYSE:KMX) Shares Up 9.6% Following Strong Earnings

CarMax, Inc. (NYSE:KMX)’s stock price rose 9.6% during trading on Thursday following a stronger than expected earnings report. The stock traded as high as $51.58 and last traded at $51.9810. Approximately 1,973,477 shares changed hands during trading, a decline of 43% from the average daily volume of 3,445,184 shares. The stock had previously closed at $47.43.

The company reported $1.31 earnings per share for the quarter, beating the consensus estimate of $0.96 by $0.35. The business had revenue of $8.01 billion for the quarter, compared to analysts’ expectations of $7.42 billion. CarMax had a return on equity of 7.00% and a net margin of 0.96%.The business’s revenue was up 6.2% on a year-over-year basis. During the same period in the previous year, the firm posted $1.38 EPS.

Key Headlines Impacting CarMax

Here are the key news stories impacting CarMax this week:

• Positive Sentiment: CarMax delivered a strong first-quarter beat, reporting adjusted EPS of $1.31 versus estimates around $0.96 and revenue of $8.01 billion versus $7.42 billion expected, helped by higher used-vehicle prices and stronger wholesale demand.
• Positive Sentiment: The company also unveiled a new four-pillar growth strategy focused on pricing, digital simplification, cost control, and finance penetration, which investors may see as a roadmap for improving performance over time.
• Positive Sentiment: Analysts have started to raise their forecasts after the report, including Mizuho lifting its price target from $38 to $43, signaling improving sentiment even though the rating remains neutral. Article Title

Analyst Upgrades and Downgrades

Several research firms recently weighed in on KMX. Robert W. Baird upped their price target on CarMax from $48.00 to $55.00 and gave the stock an “outperform” rating in a research note on Thursday. Truist Financial set a $50.00 target price on CarMax in a research note on Thursday. Stephens upgraded CarMax from an “equal weight” rating to an “overweight” rating and set a $66.00 target price on the stock in a research note on Thursday. Benchmark reissued a “hold” rating on shares of CarMax in a report on Thursday. Finally, Royal Bank Of Canada increased their price target on CarMax from $41.00 to $45.00 and gave the company a “sector perform” rating in a report on Thursday. Two equities research analysts have rated the stock with a Buy rating, thirteen have assigned a Hold rating and five have assigned a Sell rating to the stock. Based on data from MarketBeat, the stock currently has a consensus rating of “Reduce” and an average target price of $46.07.

Hedge Funds Weigh In On CarMax

A number of institutional investors have recently bought and sold shares of KMX. Huntington National Bank increased its stake in CarMax by 62.4% in the 4th quarter. Huntington National Bank now owns 690 shares of the company’s stock worth $27,000 after buying an additional 265 shares in the last quarter. CYBER HORNET ETFs LLC purchased a new position in CarMax in the 2nd quarter worth approximately $28,000. Wellington Grp LLC lifted its holdings in CarMax by 6,500.0% in the 1st quarter. Wellington Grp LLC now owns 726 shares of the company’s stock worth $30,000 after purchasing an additional 715 shares in the last quarter. MUFG Securities EMEA plc purchased a new position in CarMax in the 2nd quarter worth approximately $30,000. Finally, Advisory Services Network LLC purchased a new position in CarMax in the 3rd quarter worth approximately $32,000.

CarMax Trading Up 9.6%

The stock has a fifty day moving average of $42.36 and a 200 day moving average of $42.45. The company has a debt-to-equity ratio of 2.93, a quick ratio of 0.49 and a current ratio of 2.20. The company has a market capitalization of $7.37 billion, a PE ratio of 32.56, a PEG ratio of 1.97 and a beta of 1.21.

CarMax Company Profile

CarMax (NYSE: KMX) is a leading retailer of used vehicles in the United States, offering customers a streamlined, no-haggle purchasing experience. The company’s inventory spans a broad range of makes and models, each of which undergoes a comprehensive inspection process before being offered for sale. Customers can shop in person at CarMax’s retail locations or browse the company’s online platform, which provides detailed vehicle histories, virtual tours and contactless purchasing options.

Originally launched in 1993 as a division of Circuit City, CarMax became an independent, publicly traded company in 1997.