CarMax (NYSE:KMX) Downgraded to "Neutral" Rating by Wedbush

Key Points

• CarMax has been downgraded by Wedbush from an "outperform" rating to a "neutral" rating, indicating a shift in analyst sentiment regarding the company's performance prospects.
• The company's recent earnings report showed an earnings per share (EPS) of $0.64, which missed the consensus estimate of $1.03 and reflected a 6.0% decline in revenue compared to the same quarter last year.
• Despite a mixed outlook from analysts—with one Strong Buy, eight Buy, four Hold, and one Sell ratings—CarMax has a consensus rating of "Moderate Buy" and an average target price of $81.50.

CarMax (NYSE:KMX - Get Free Report) was downgraded by Wedbush from an "outperform" rating to a "neutral" rating in a research note issued to investors on Thursday,Briefing.com Automated Import reports.

A number of other research analysts have also issued reports on the company. Evercore ISI reduced their price objective on CarMax from $82.00 to $80.00 and set an "outperform" rating for the company in a research report on Tuesday, August 12th. Truist Financial boosted their price objective on CarMax from $72.00 to $74.00 and gave the company a "hold" rating in a research report on Monday, June 23rd. Royal Bank Of Canada boosted their price objective on CarMax from $80.00 to $81.00 and gave the company an "outperform" rating in a research report on Monday, June 23rd. Benchmark assumed coverage on CarMax in a research report on Thursday, July 17th. They set a "buy" rating and a $75.00 price objective for the company. Finally, Needham & Company LLC restated a "buy" rating and set a $92.00 price objective on shares of CarMax in a research report on Monday, June 23rd. One analyst has rated the stock with a Strong Buy rating, eight have assigned a Buy rating, four have given a Hold rating and one has assigned a Sell rating to the stock. According to MarketBeat.com, CarMax currently has a consensus rating of "Moderate Buy" and an average target price of $81.50.

CarMax Price Performance

KMX stock opened at $57.25 on Thursday. The company has a market capitalization of $8.59 billion, a PE ratio of 15.82, a P/E/G ratio of 0.94 and a beta of 1.35. The stock's 50 day moving average is $59.28 and its two-hundred day moving average is $65.20. The company has a quick ratio of 0.80, a current ratio of 2.39 and a debt-to-equity ratio of 2.86. CarMax has a 52-week low of $54.53 and a 52-week high of $91.25.

CarMax (NYSE:KMX - Get Free Report) last issued its earnings results on Thursday, September 25th. The company reported $0.64 EPS for the quarter, missing the consensus estimate of $1.03 by ($0.39). The firm had revenue of $6.59 billion during the quarter, compared to analyst estimates of $7.07 billion. CarMax had a return on equity of 9.11% and a net margin of 2.09%.CarMax's revenue was down 6.0% compared to the same quarter last year. During the same quarter in the previous year, the business posted $0.85 EPS. Analysts predict that CarMax will post 3.23 earnings per share for the current fiscal year.

Insider Transactions at CarMax

In other CarMax news, EVP Jon G. Daniels sold 1,540 shares of the business's stock in a transaction on Wednesday, July 2nd. The stock was sold at an average price of $70.64, for a total transaction of $108,785.60. Following the completion of the transaction, the executive vice president owned 2,779 shares in the company, valued at approximately $196,308.56. The trade was a 35.66% decrease in their position. The sale was disclosed in a legal filing with the SEC, which can be accessed through this link. Company insiders own 1.70% of the company's stock.

Institutional Trading of CarMax

A number of hedge funds and other institutional investors have recently modified their holdings of the company. Texas Permanent School Fund Corp raised its stake in shares of CarMax by 59.5% in the 2nd quarter. Texas Permanent School Fund Corp now owns 27,488 shares of the company's stock worth $1,847,000 after buying an additional 10,259 shares in the last quarter. Osaic Holdings Inc. raised its stake in shares of CarMax by 49.0% in the 2nd quarter. Osaic Holdings Inc. now owns 159,895 shares of the company's stock worth $10,768,000 after buying an additional 52,576 shares in the last quarter. Orion Porfolio Solutions LLC raised its stake in shares of CarMax by 14.4% in the 2nd quarter. Orion Porfolio Solutions LLC now owns 24,411 shares of the company's stock worth $1,641,000 after buying an additional 3,070 shares in the last quarter. Thrivent Financial for Lutherans raised its stake in shares of CarMax by 202.1% in the 2nd quarter. Thrivent Financial for Lutherans now owns 26,230 shares of the company's stock worth $1,762,000 after buying an additional 17,548 shares in the last quarter. Finally, Cape Investment Advisory Inc. raised its stake in shares of CarMax by 3.7% in the 2nd quarter. Cape Investment Advisory Inc. now owns 15,792 shares of the company's stock worth $1,061,000 after buying an additional 568 shares in the last quarter.

About CarMax

CarMax, Inc, through its subsidiaries, operates as a retailer of used vehicles and related products in the United States. It operates in two segments: CarMax Sales Operations and CarMax Auto Finance. The CarMax Sales Operations segment offers customers a range of makes and models of used vehicles, including domestic, imported, and luxury vehicles, as well as hybrid and electric vehicles; used vehicle auctions; extended protection plans to customers at the time of sale; and reconditioning and vehicle repair services.

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