CarMax (NYSE:KMX) Price Target Lowered to $56.00 at Morgan Stanley

Key Points

• Morgan Stanley has lowered its price target for CarMax from $80.00 to $56.00, maintaining an "overweight" rating, which suggests a potential upside of 24.44% from the current price.
• CarMax reported earnings per share of $0.64 for the last quarter, missing estimates of $1.03, with revenue also falling short at $6.59 billion compared to the expected $7.07 billion.
• Several analysts have adjusted their ratings on CarMax, with the consensus rating now being "Hold" and an average target price of $60.31, reflecting a significant reduction in price targets across multiple firms.

CarMax (NYSE:KMX - Get Free Report) had its target price dropped by research analysts at Morgan Stanley from $80.00 to $56.00 in a research note issued to investors on Wednesday,Benzinga reports. The firm presently has an "overweight" rating on the stock. Morgan Stanley's price objective indicates a potential upside of 24.44% from the company's current price.

Several other equities research analysts have also commented on KMX. Evercore ISI restated an "in-line" rating and set a $52.00 target price (down previously from $80.00) on shares of CarMax in a research report on Friday, September 26th. JPMorgan Chase & Co. decreased their price target on CarMax from $65.00 to $50.00 and set a "neutral" rating for the company in a research report on Friday, September 26th. BNP Paribas Exane reduced their price objective on CarMax from $52.00 to $35.00 and set an "underperform" rating for the company in a report on Friday, September 26th. Oppenheimer reaffirmed a "market perform" rating on shares of CarMax in a report on Friday, September 26th. Finally, Robert W. Baird dropped their price objective on CarMax from $90.00 to $60.00 and set an "outperform" rating for the company in a research note on Friday, September 26th. One equities research analyst has rated the stock with a Strong Buy rating, six have given a Buy rating, seven have issued a Hold rating and one has issued a Sell rating to the stock. According to MarketBeat, the company currently has a consensus rating of "Hold" and an average target price of $60.31.

CarMax Stock Performance

Shares of KMX traded up $0.13 during mid-day trading on Wednesday, reaching $45.00. The company's stock had a trading volume of 1,741,757 shares, compared to its average volume of 3,138,463. CarMax has a 1-year low of $42.75 and a 1-year high of $91.25. The stock has a market cap of $6.61 billion, a P/E ratio of 13.20, a PEG ratio of 0.82 and a beta of 1.35. The business has a 50-day simple moving average of $57.89 and a two-hundred day simple moving average of $64.42. The company has a current ratio of 2.46, a quick ratio of 1.06 and a debt-to-equity ratio of 2.87.

CarMax (NYSE:KMX - Get Free Report) last released its quarterly earnings data on Thursday, September 25th. The company reported $0.64 earnings per share (EPS) for the quarter, missing analysts' consensus estimates of $1.03 by ($0.39). The business had revenue of $6.59 billion during the quarter, compared to analyst estimates of $7.07 billion. CarMax had a net margin of 1.98% and a return on equity of 8.51%. The business's quarterly revenue was down 6.0% on a year-over-year basis. During the same period in the previous year, the business earned $0.85 earnings per share. As a group, equities research analysts anticipate that CarMax will post 3.23 earnings per share for the current fiscal year.

Institutional Investors Weigh In On CarMax

Hedge funds have recently added to or reduced their stakes in the stock. Avior Wealth Management LLC increased its stake in shares of CarMax by 6,129.3% in the 2nd quarter. Avior Wealth Management LLC now owns 9,344 shares of the company's stock worth $628,000 after purchasing an additional 9,194 shares in the last quarter. Mirae Asset Global Investments Co. Ltd. increased its stake in shares of CarMax by 13.0% in the 1st quarter. Mirae Asset Global Investments Co. Ltd. now owns 20,678 shares of the company's stock worth $1,571,000 after purchasing an additional 2,375 shares in the last quarter. Teacher Retirement System of Texas purchased a new stake in shares of CarMax in the 1st quarter worth $1,753,000. Sequoia Financial Advisors LLC increased its stake in shares of CarMax by 5.5% in the 1st quarter. Sequoia Financial Advisors LLC now owns 3,367 shares of the company's stock worth $262,000 after purchasing an additional 176 shares in the last quarter. Finally, Wedge Capital Management L L P NC increased its stake in shares of CarMax by 54.9% in the 2nd quarter. Wedge Capital Management L L P NC now owns 102,632 shares of the company's stock worth $6,898,000 after purchasing an additional 36,376 shares in the last quarter.

CarMax Company Profile

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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