CarMax (NYSE:KMX) Upgraded by JPMorgan Chase & Co. to "Neutral" Rating

Key Points

• CarMax has been upgraded from an "underweight" rating to a "neutral" rating by JPMorgan Chase & Co., with a price target of $58.00, suggesting a potential upside of 3.35% from its previous close.
• In the latest quarterly earnings, CarMax reported $1.38 EPS, exceeding estimates, while revenue reached $7.55 billion, reflecting a 6.1% increase year-over-year.
• Currently, CarMax has a consensus rating of "Moderate Buy" from analysts, with a diverse outlook that includes ratings of sell, hold, and buy from several research firms.

JPMorgan Chase & Co. upgraded shares of CarMax (NYSE:KMX - Free Report) from an underweight rating to a neutral rating in a research report sent to investors on Wednesday morning, MarketBeat.com reports. They currently have $58.00 target price on the stock, down from their prior target price of $65.00.

Other analysts have also issued reports about the company. Morgan Stanley began coverage on CarMax in a research note on Tuesday, July 1st. They set an "overweight" rating and a $80.00 price objective on the stock. 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 note on Monday, June 23rd. Wall Street Zen upgraded CarMax from a "sell" rating to a "hold" rating in a research note on Wednesday, May 7th. Robert W. Baird decreased their price objective on CarMax from $95.00 to $90.00 and set an "outperform" rating on the stock in a research note on Friday, April 11th. Finally, Cfra Research upgraded CarMax to a "strong-buy" rating in a research note on Thursday, April 10th. One equities research analyst has rated the stock with a sell rating, four have assigned a hold rating, nine have assigned a buy rating and one has issued a strong buy rating to the company. According to data from MarketBeat.com, the stock currently has an average rating of "Moderate Buy" and a consensus target price of $83.08.

CarMax Stock Performance

Shares of KMX traded down $0.31 during mid-day trading on Wednesday, hitting $54.94. The stock had a trading volume of 1,738,068 shares, compared to its average volume of 3,093,608. The firm has a market cap of $8.24 billion, a P/E ratio of 15.18, a PEG ratio of 0.90 and a beta of 1.36. The business has a fifty day moving average price of $64.06 and a 200-day moving average price of $70.79. The company has a debt-to-equity ratio of 2.86, a current ratio of 2.39 and a quick ratio of 0.80. CarMax has a 52 week low of $54.53 and a 52 week high of $91.25.

CarMax (NYSE:KMX - Get Free Report) last released its quarterly earnings data on Friday, June 20th. The company reported $1.38 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $1.18 by $0.20. CarMax had a return on equity of 9.11% and a net margin of 2.09%. The company had revenue of $7.55 billion for the quarter, compared to analyst estimates of $7.58 billion. During the same period in the previous year, the company posted $0.97 EPS. The firm's revenue for the quarter was up 6.1% compared to the same quarter last year. On average, equities research analysts expect that CarMax will post 3.23 EPS for the current year.

Insider Activity

In other news, EVP Jon G. Daniels sold 1,540 shares of the company's stock in a transaction dated Wednesday, July 2nd. The stock was sold at an average price of $70.64, for a total value of $108,785.60. Following the completion of the transaction, the executive vice president directly owned 2,779 shares in the company, valued at approximately $196,308.56. This represents a 35.66% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through this link. Insiders own 1.70% of the company's stock.

Hedge Funds Weigh In On CarMax

A number of hedge funds and other institutional investors have recently modified their holdings of KMX. Zions Bancorporation National Association UT purchased a new stake in CarMax during the 1st quarter valued at about $27,000. Accent Capital Management LLC purchased a new stake in CarMax during the 1st quarter valued at about $34,000. Strengthening Families & Communities LLC boosted its holdings in CarMax by 93.1% during the 1st quarter. Strengthening Families & Communities LLC now owns 531 shares of the company's stock valued at $39,000 after acquiring an additional 256 shares during the period. Ameriflex Group Inc. purchased a new stake in CarMax during the 4th quarter valued at about $53,000. Finally, Quarry LP raised its position in CarMax by 50.5% during the 1st quarter. Quarry LP now owns 694 shares of the company's stock valued at $54,000 after purchasing an additional 233 shares during 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.