Latest news with #Carmax
Yahoo
a day ago
- Automotive
- Yahoo
Why Is CarMax (KMX) Stock Rocketing Higher Today
Shares of used automotive vehicle retailer Carmax (NYSE:KMX) jumped 5.8% in the afternoon session after the company reported impressive fiscal first-quarter 2026 results, which beat analysts' same-store sales and gross margin expectations. This led to nice EPS outperformance versus Wall Street's estimates. Growth was driven by a ramp in volumes of retail used and wholesale vehicles sold. Overall, this was a solid quarter, showing management is executing as expected. Is now the time to buy CarMax? Access our full analysis report here, it's free. CarMax's shares are not very volatile and have only had 7 moves greater than 5% over the last year. In that context, today's move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business. The biggest move we wrote about over the last year was 2 months ago when the stock dropped 19.8% on the news that the company reported underwhelming Q1 2025 (fiscal Q4 2025) results. Its EBITDA missed significantly and its EPS fell short of Wall Street's estimates. More troubling, the company suspended its long-term growth guidance, citing macroeconomic uncertainty, a move that signaled management's reduced visibility and confidence in the future growth trajectory. Overall, this quarter could have been better. CarMax is down 16% since the beginning of the year, and at $68.26 per share, it is trading 23.5% below its 52-week high of $89.19 from February 2025. Investors who bought $1,000 worth of CarMax's shares 5 years ago would now be looking at an investment worth $726.48. Here at StockStory, we certainly understand the potential of thematic investing. Diverse winners from Microsoft (MSFT) to Alphabet (GOOG), Coca-Cola (KO) to Monster Beverage (MNST) could all have been identified as promising growth stories with a megatrend driving the growth. So, in that spirit, we've identified a relatively under-the-radar profitable growth stock benefiting from the rise of AI, available to you FREE via this link. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
a day ago
- Automotive
- Yahoo
Carmax Posts Higher Profit, Revenue
Carmax logged higher profit and sales in its fiscal first quarter as the company sold more cars, despite slightly lower prices. The Richmond, Va., used-car retailer on Friday posted a profit of $210.4 million for its three months ended May 31, compared with a profit of $152.4 million a year earlier. Quarterly earnings came in at $1.38 a share, topping the $1.16 a share that analysts polled by FactSet expected. Surging Silver Prices Prompt Americans to Empty Jewelry Boxes and Coin Jars Home Depot Bid Kicks Off Battle for $5 Billion Building-Products Company How Do You Build a $500 Million Coffee Chain? By Selling Matcha to Teens. The Real Message Andy Jassy Is Sending to Employees on AI Don't Fall in Love With AI, and Other Life Rules for Graduates Revenue rose 6.1% to $7.55 billion, just ahead of the $7.5 billion that analysts modeled. Combined retail and wholesale used-unit sales came in at 379,727, marking a 5.8% increase from the prior year's first quarter. Retail sales grew at a faster rate than wholesale. Same-store used-unit sales increased 8.1% from last year. The average selling prices of used and wholesale vehicles fell 1.5% and 1.7%, respectively, from last year, though this decrease was more than offset by higher sales volumes. Chief Executive Bill Nash said Carmax benefits from its customer-centric car-buying and selling experience: 'This is a key differentiator in a very large and fragmented market that positions us to continue to drive sales, gain market share and deliver significant year-over-year earnings growth for years to come.' Shares rose 8.8%, to $69.99, in premarket trading. Write to Connor Hart at How Hackers Are Turning Tech Support Into a Threat SpaceX's Starship Explodes During Ground Test Oil Prices Rally, Stock Futures Fall in Holiday-Thinned Trading Food, Agriculture Leaders Sound Warnings on MAHA Overreach OpenAI Changes Price Structure for Business Version of ChatGPT Sign in to access your portfolio
Wall Street Journal
a day ago
- Automotive
- Wall Street Journal
Carmax Posts Higher Profit, Revenue
Carmax KMX -0.16%decrease; red down pointing triangle logged higher profit and sales in its fiscal first quarter as the company sold more cars, despite slightly lower prices. The Richmond, Va., used-car retailer on Friday posted a profit of $210.4 million for its three months ended May 31, compared with a profit of $152.4 million a year earlier. Quarterly earnings came in at $1.38 a share, topping the $1.16 a share that analysts polled by FactSet expected.
Yahoo
23-04-2025
- Automotive
- Yahoo
KMX Q1 Earnings: CarMax Matches Revenue Expectations, Misses Profit Targets Amid Shifting Market Dynamics
Used automotive vehicle retailer Carmax (NYSE:KMX) met Wall Street's revenue expectations in Q1 CY2025, with sales up 6.7% year on year to $6 billion. Its non-GAAP profit of $0.60 per share was 8.6% below analysts' consensus estimates. Is now the time to buy KMX? Revenue: $6 billion vs analyst estimates of $5.99 billion (6.7% year-on-year growth, in line) Adjusted EPS: $0.60 vs analyst expectations of $0.66 (8.6% miss) Adjusted EBITDA: $234.2 million vs analyst estimates of $228.7 million (3.9% margin, 2.4% beat) Operating Margin: 2.5%, in line with the same quarter last year Free Cash Flow Margin: 0.3%, down from 3.6% in the same quarter last year Locations: 250 at quarter end, up from 245 in the same quarter last year Same-Store Sales rose 5.9% year on year (-2% in the same quarter last year) Market Capitalization: $9.93 billion CarMax's first quarter results reflected steady growth in unit sales and improved operational efficiency, driven by investments in technology and a broader product mix. Management attributed the year-on-year sales increase to enhanced digital capabilities, a more efficient sourcing process from both consumers and dealers, and ongoing cost savings across logistics and reconditioning operations. CEO Bill Nash cited the company's ability to offer a seamless online and in-store experience as a key differentiator in the highly competitive used car market. Looking forward, CarMax's leadership emphasized the potential impact of new tariffs and rising parts costs, which could influence both demand and profitability. They highlighted ongoing efforts to mitigate these risks through cost control and expanded financing offerings, while also noting that macroeconomic uncertainty and shifting consumer preferences continue to shape the company's outlook. Management was cautious in its forward guidance, focusing on sustaining recent momentum and adapting to changing market conditions. CarMax's management provided a comprehensive update on the factors driving the quarter's performance and the company's evolving strategy. They highlighted improvements in unit volumes, digital engagement, and operational efficiencies, while also addressing near-term challenges around profitability and external cost pressures. The discussion underscored CarMax's commitment to balancing growth initiatives with prudent cost management in a volatile economic environment. Digital Sales Integration: CarMax saw a growing proportion of retail transactions supported by digital tools, with 67% of sales classified as 'omni-channel' under the updated definition. Management expects continued growth in digitally assisted sales as online tools and customer adoption improve. Supply Chain and Sourcing: The company achieved record vehicle sourcing from both consumers and dealers, driven by enhancements to its online appraisal platform and dealer-facing solutions. These initiatives are designed to broaden inventory and better meet shifting consumer demand. Financing Model Expansion: CarMax Auto Finance (CAF) expanded its lending across more segments of the credit spectrum. By retaining a greater share of profitable loan originations previously allocated to third parties, management expects to increase CAF's penetration and drive long-term income growth, despite higher near-term provisions for loan losses. Operational Efficiency Gains: The company reported meaningful cost savings in logistics and reconditioning, exceeding initial targets with $125 per unit in annual efficiency improvements. These savings are expected to help offset rising parts costs and support affordability for customers. Market Share and Product Mix: CarMax experienced notable growth in sales of late-model (zero to four-year-old) vehicles, while maintaining its presence in the six- to ten-year-old segment. Management emphasized a flexible approach to inventory mix, based on evolving consumer preferences and market dynamics. Management's outlook for the coming quarters is shaped by ongoing investments in digital capabilities, efficiency initiatives, and expanded financing options, all set against a backdrop of macroeconomic uncertainty and possible cost inflation. No explicit revenue or profit guidance was provided for the next quarter or the full year. Tariffs and Cost Pressures: New tariffs on automotive imports and rising parts prices could increase costs for both new and used vehicles. Management plans to mitigate these impacts through ongoing efficiency gains and pricing strategies, but acknowledged uncertainty around the ultimate effect on demand and margins. Financing Penetration: CarMax's strategy to broaden its credit spectrum and recapture more loan originations is expected to drive future income growth in CarMax Auto Finance, albeit with temporarily higher provisions for loan losses as the mix shifts. Digital Experience Enhancements: Continued investment in online tools and customer-facing technology is aimed at increasing conversion rates, improving the shopping experience, and supporting sales growth, especially as consumer preferences evolve toward more digital interactions. Sharon Zackfia (William Blair): Asked about the drivers behind the company's market share recovery and lessons learned from earlier periods of share loss; management cited improved execution, expanded sourcing, and adaptability to changing consumer preferences. Seth Basham (Wedbush Securities): Inquired about the impact of new car tariffs on used vehicle demand and CarMax's share gains; CEO Bill Nash explained that higher new car prices could drive more consumers to the used market, especially for late-model vehicles. John Murphy (Bank of America): Questioned the sustainability of operational cost savings and the company's ability to maintain margins amid changing reconditioning and supply chain dynamics; management highlighted ongoing efficiency efforts and the benefits of additional reconditioning capacity. Rajat Gupta (JPMorgan): Sought details on how CarMax is managing inventory acquisition amid tariff uncertainty and auction market volatility; management emphasized long-standing expertise in inventory management and reliance on data-driven sourcing. Chris Bottiglieri (BNP Paribas): Asked if CarMax has remaining cost levers to pull in the event of an economic downturn; CFO Enrique Mayor-Mora responded that further efficiency improvements are planned and the company retains the ability to adjust costs as needed. In upcoming quarters, our analysts will watch (1) the company's ability to manage cost inflation and pass along efficiency gains to offset tariff-related headwinds, (2) the pace of growth in digitally supported and omni-channel sales as technology initiatives mature, and (3) continued expansion of CarMax Auto Finance's penetration across the credit spectrum. Execution on these fronts, along with adaptability to macroeconomic and industry shifts, will be critical indicators of CarMax's ability to sustain growth and profitability. Could KMX achieve its goals and exceed our expectations? See for yourself in our free research report. The market surged in 2024 and reached record highs after Donald Trump's presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025. While the crowd speculates what might happen next, we're homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver's seat and build a durable portfolio by checking out our Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 175% over the last five years. Stocks that made our list in 2019 include now familiar names such as Nvidia (+2,183% between December 2019 and December 2024) as well as under-the-radar businesses like Comfort Systems (+751% five-year return). Find your next big winner with StockStory today.
Yahoo
19-04-2025
- Automotive
- Yahoo
Giverny Capital Asset Management Sold Carmax (KMX) Amid Difficult Competitive Environment
Giverny Capital Asset Management, LLC, an investment management company, recently published its first-quarter 2025 investor letter. A copy of the letter can be downloaded here. The portfolio returned -3.39% in the quarter, compared to a -4.27% return for the S&P 500 Total Return Index. For the year ended March 31, 2025, the fund returned 1.75% compared to an 8.25% return for the Index during the same period. For more information on the fund's best picks in 2025, please check its top five holdings. In its first quarter 2025 investor letter, Giverny Capital Asset Management highlighted stocks such as CarMax, Inc. (NYSE:KMX). CarMax, Inc. (NYSE:KMX) is a used vehicle retailer headquartered in Richmond, Virginia. The one-month return of CarMax, Inc. (NYSE:KMX) was -9.90%, and its shares lost 4.89% of their value over the last 52 weeks. On April 17, 2025, CarMax, Inc. (NYSE:KMX) stock closed at $64.59 per share with a market capitalization of $9.862 billion. Giverny Capital Asset Management stated the following regarding CarMax, Inc. (NYSE:KMX) in its Q1 2025 investor letter: "We trimmed CarMax, Inc. (NYSE:KMX) during the quarter – it has been a rough few years for the used car retailer. I believe the customer friendly business model remains attractive, but a lot of Wall Street capital has flowed to Carvana, creating a more difficult competitive environment. In early April, Carmax reported encouraging operating results. Yet despite heavy investment in online selling capabilities, Carmax is not gaining market share. We adjusted the position size to acknowledge that fact." A happy customer inspecting a newly purchased used car with the help of a sales assistant. CarMax, Inc. (NYSE:KMX) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 57 hedge fund portfolios held CarMax, Inc. (NYSE:KMX) at the end of the fourth quarter compared to 44 in the third quarter. In the fourth quarter of financial year 2025, CarMax, Inc. (NYSE:KMX) reported total sales of $6 billion, up 7% from prior year's quarter. While we acknowledge the potential of CarMax, Inc. (NYSE:KMX) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock. We covered CarMax, Inc. (NYSE:KMX) in another article, where we shared top stock picks from Diamond Hill Capital. In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors. READ NEXT: Michael Burry Is Selling These Stocks and A New Dawn Is Coming to US Stocks. Disclosure: None. This article is originally published at Insider Monkey.
