What's Next: CarMax's Earnings Preview

CarMax KMX is gearing up to announce its quarterly earnings on Friday, 2025-06-20. Here's a quick overview of what investors should know before the release.

Analysts are estimating that CarMax will report an earnings per share (EPS) of $1.17.

Anticipation surrounds CarMax's announcement, with investors hoping to hear about both surpassing estimates and receiving positive guidance for the next quarter.

New investors should understand that while earnings performance is important, market reactions are often driven by guidance.

Overview of Past Earnings

The company's EPS missed by $0.02 in the last quarter, leading to a 2.87% increase in the share price on the following day.

Here's a look at CarMax's past performance and the resulting price change:

Stock Performance

Shares of CarMax were trading at $64.43 as of June 17. Over the last 52-week period, shares are down 10.19%. Given that these returns are generally negative, long-term shareholders are likely upset going into this earnings release.

Analyst Opinions on CarMax

For investors, grasping market sentiments and expectations in the industry is vital. This analysis explores the latest insights regarding CarMax.

A total of 11 analyst ratings have been received for CarMax, with the consensus rating being Outperform. The average one-year price target stands at $87.36, suggesting a potential 35.59% upside.

Analyzing Ratings Among Peers

In this comparison, we explore the analyst ratings and average 1-year price targets of Penske Automotive Group, Lithia Motors and Murphy USA, three prominent industry players, offering insights into their relative performance expectations and market positioning.

• Analysts currently favor an Buy trajectory for Penske Automotive Group, with an average 1-year price target of $167.5, suggesting a potential 159.97% upside.
• Analysts currently favor an Buy trajectory for Lithia Motors, with an average 1-year price target of $361.71, suggesting a potential 461.4% upside.
• Analysts currently favor an Outperform trajectory for Murphy USA, with an average 1-year price target of $516.67, suggesting a potential 701.91% upside.

Comprehensive Peer Analysis Summary

The peer analysis summary presents essential metrics for Penske Automotive Group, Lithia Motors and Murphy USA, unveiling their respective standings within the industry and providing valuable insights into their market positions and comparative performance.

Key Takeaway:

CarMax ranks first in revenue growth among its peers. It has the highest gross profit margin. CarMax has the lowest return on equity compared to its peers.

About CarMax

CarMax sells, finances, and services used and new cars through a chain of around 250 used retail stores. It was formed in 1993 as a unit of Circuit City and spun off into an independent company in late 2002. Used-vehicle sales were 83% of fiscal 2025 revenue and wholesale about 17%, with the remaining portion composed of extended service plans and repair. In fiscal 2025, the company retailed and wholesaled 789,050 and 544,312 used vehicles, respectively. CarMax is the largest used-vehicle retailer in the US but still estimates that it had only about 3.7% US market share of vehicles 0-10 years old in calendar 2024. It seeks over 5% share. CarMax is based in Richmond, Virginia.

Key Indicators: CarMax's Financial Health

Market Capitalization: Boasting an elevated market capitalization, the company surpasses industry averages. This signals substantial size and strong market recognition.

Revenue Growth: Over the 3 months period, CarMax showcased positive performance, achieving a revenue growth rate of 6.69% as of 28 February, 2025. This reflects a substantial increase in the company's top-line earnings. As compared to its peers, the company achieved a growth rate higher than the average among peers in Consumer Discretionary sector.

Net Margin: The company's net margin is a standout performer, exceeding industry averages. With an impressive net margin of 1.5%, the company showcases strong profitability and effective cost control.

Return on Equity (ROE): CarMax's ROE surpasses industry standards, highlighting the company's exceptional financial performance. With an impressive 1.44% ROE, the company effectively utilizes shareholder equity capital.

Return on Assets (ROA): CarMax's ROA surpasses industry standards, highlighting the company's exceptional financial performance. With an impressive 0.33% ROA, the company effectively utilizes its assets for optimal returns.

Debt Management: CarMax's debt-to-equity ratio is below industry norms, indicating a sound financial structure with a ratio of 3.08.

To track all earnings releases for CarMax visit their earnings calendar on our site.

This article was generated by Benzinga's automated content engine and reviewed by an editor.