CarMax Set to Reveal Earnings: Analysts Predict Significant Profit Growth
CarMax, Inc. (KMX), the leading used car retailer in the United States, boasts a market cap of $13 billion. Renowned for its no-haggle pricing and extensive vehicle selection, the company operates from its headquarters in Richmond, Virginia, and provides both physical and online car sales services. Investors eagerly await the release of its Q4 earnings report, scheduled for Thursday, April 10.
Profit Predictions Ahead of Earnings Call
Analysts forecast that CarMax will report earnings of $0.62 per share, representing a remarkable increase of 93.8% compared to $0.32 per share during the same quarter last year. It’s worth noting that CarMax has had a mixed track record lately, falling short of Wall Street’s profit expectations in three of the last four quarters while surpassing them once.
Future Earnings Expectations
Looking at fiscal year 2025, estimates suggest the company will achieve earnings per share (EPS) of $3.25, which shows a 7.6% growth from $3.02 in fiscal 2024.
Stock Performance and Comparison
Over the last year, KMX shares have experienced a 21.6% increase. This growth lags behind the S&P 500 Index’s gain of nearly 24.1%, as well as the Consumer Discretionary Select Sector SPDR Fund’s impressive 34.9% climb in the same period.
Recent Success and Market Reactions
A notable spike in KMX shares occurred on December 19, when they jumped over 3% following the release of Q3 results. CarMax reported an EPS of $0.81 and revenue of $6.2 billion, both surpassing expectations. The company’s strong performance was attributed to a 5.4% year-over-year rise in retail used vehicle sales, coupled with stable vehicle valuations contributing to improved profit margins. Furthermore, Auto Finance income saw an increase of 7.6% year-over-year, enhanced by a better spread between customer charges and funding costs.
Analysts’ Outlook on CarMax Stock
Currently, analysts hold a cautiously optimistic consensus rating for CarMax stock, issuing a “Moderate Buy” overall. Among the 17 analysts covering the stock, there are five “Strong Buys,” three “Moderate Buys,” six “Holds,” one “Moderate Sell,” and two “Strong Sell.” Notably, KMX is trading above the average analyst price target of $84.57.
On the date of publication, Kritika Sarmah did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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