CarMax (NYSE:KMX) Now Covered by Bank of America

Bank of America started coverage on shares of CarMax (NYSE:KMX) in a research note issued on Wednesday. The firm set an “underperform” rating and a $40.00 price target on the stock. Bank of America‘s price objective suggests a potential downside of 1.59% from the stock’s previous close.

A number of other equities research analysts have also weighed in on the company. Royal Bank Of Canada reaffirmed a “sector perform” rating and set a $41.00 target price on shares of CarMax in a research report on Wednesday. Barclays lifted their target price on CarMax from $24.00 to $28.00 and gave the company an “underweight” rating in a research report on Wednesday, January 21st. Zacks Research raised CarMax from a “strong sell” rating to a “hold” rating in a research report on Monday, January 5th. JPMorgan Chase & Co. decreased their target price on CarMax from $30.00 to $28.00 and set an “underweight” rating for the company in a research report on Friday, December 19th. Finally, Wall Street Zen upgraded CarMax from a “sell” rating to a “hold” rating in a report on Saturday, April 4th. One investment analyst has rated the stock with a Buy rating, twelve have given a Hold rating and five have assigned a Sell rating to the company’s stock. Based on data from MarketBeat.com, CarMax currently has a consensus rating of “Reduce” and a consensus price target of $40.86.

CarMax Stock Down 2.4%

NYSE KMX traded down $1.01 on Wednesday, reaching $40.65. 289,951 shares of the stock traded hands, compared to its average volume of 3,495,302. The company has a debt-to-equity ratio of 2.74, a quick ratio of 0.51 and a current ratio of 1.99. The company has a fifty day moving average price of $43.00 and a 200-day moving average price of $41.98. The company has a market cap of $5.76 billion, a price-to-earnings ratio of 13.35, a PEG ratio of 1.29 and a beta of 1.30. CarMax has a 12 month low of $30.26 and a 12 month high of $71.99.

CarMax (NYSE:KMX) last issued its earnings results on Tuesday, April 14th. The company reported $0.34 earnings per share for the quarter, beating analysts’ consensus estimates of $0.18 by $0.16. The business had revenue of $5.95 billion during the quarter, compared to analyst estimates of $5.65 billion. CarMax had a return on equity of 7.72% and a net margin of 1.77%.CarMax’s revenue was down 1.0% on a year-over-year basis. During the same period in the previous year, the company posted $0.58 EPS. As a group, research analysts forecast that CarMax will post 3.23 EPS for the current fiscal year.

Institutional Inflows and Outflows

A number of institutional investors and hedge funds have recently made changes to their positions in KMX. Huntington National Bank increased its holdings in shares of CarMax by 62.4% in the 4th quarter. Huntington National Bank now owns 690 shares of the company’s stock valued at $27,000 after acquiring an additional 265 shares during the period. CYBER HORNET ETFs LLC purchased a new position in shares of CarMax in the 2nd quarter valued at $28,000. MUFG Securities EMEA plc purchased a new position in CarMax during the 2nd quarter worth $30,000. Center for Financial Planning Inc. purchased a new position in CarMax during the 3rd quarter worth $31,000. Finally, Advisory Services Network LLC purchased a new position in CarMax during the 3rd quarter worth $32,000.

Key CarMax News

Here are the key news stories impacting CarMax this week:

• Positive Sentiment: Adjusted Q4 results beat consensus — CarMax reported adjusted EPS of $0.34 and revenue of $5.95B, topping Street estimates and showing demand that still supports topline. CarMax Press Release
• Positive Sentiment: New CEO + strategic tech focus — Management highlighted a new CEO (Keith Barr) and a push to invest in technology to streamline the buying/selling experience, which could improve customer acquisition and margins over time if execution succeeds. CarMax Bets on Tech to Streamline Used Car Buying Journey
• Neutral Sentiment: Full materials/transcript available for due diligence — The earnings slide deck and call transcript are published for investors to review management’s detail on unit trends, margins and reserve methodology. Earnings Call Transcript
• Negative Sentiment: Price cuts have compressed vehicle margins — Management implemented price reductions to stimulate demand; gross profit per retail used unit declined materially, weighing on profitability and investor confidence. CarMax posts quarterly loss on goodwill charge, weak used-car demand
• Negative Sentiment: GAAP loss and one-time charges highlighted near-term weakness — The quarter included a goodwill impairment that produced a GAAP loss despite positive adjusted results, increasing uncertainty about asset valuations and near-term earnings. CarMax (KMX) Stock Plunges 13% on Quarterly Loss and Margin Erosion
• Negative Sentiment: Credit provisioning and finance-segment pressure — Higher provisions for loan losses were flagged as a near-term drag on results, which amplifies earnings volatility while reserves are rebuilt. QuiverQuant Analysis
• Negative Sentiment: Analyst downgrades and a new sell initiation increase downside pressure — Bank of America initiated a Sell citing margin compression and demand headwinds; other firms reiterated cautious or underweight views and lowered targets, amplifying selling. BofA Sell Rating

About CarMax

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.