Zacks Research Comments on CarMax's Q2 Earnings (NYSE:KMX)

Key Points

• Zacks Research raised its Q2 2028 CarMax EPS estimate to $1.12 from $1.08 and maintained a “Strong Buy” rating, with FY2028 and FY2029 EPS estimates of $3.76 and $4.36, respectively.
• CarMax’s latest quarter exceeded expectations, reporting $1.16 EPS versus the $0.73 consensus and $7.88 billion in revenue, up 19.5% year over year.
• Despite improving analyst sentiment—including Bank of America’s upgrade to Buy—the stock carries a consensus “Hold” rating with a $57.85 target, while recent volatility remains a concern after a 15.3% four-week decline.

CarMax, Inc. (NYSE:KMX - Free Report) - Investment analysts at Zacks Research lifted their Q2 2028 earnings estimates for CarMax in a research report issued to clients and investors on Friday, October 16th. Zacks Research analyst Team now expects that the company will post earnings per share of $1.12 for the quarter, up from their prior estimate of $1.08. Zacks Research currently has a "Strong-Buy" rating on the stock. The consensus estimate for CarMax's current full-year earnings is $3.10 per share. Zacks Research also issued estimates for CarMax's Q3 2028 earnings at $0.90 EPS, Q4 2028 earnings at $0.53 EPS, FY2028 earnings at $3.76 EPS, Q1 2029 earnings at $1.13 EPS, Q2 2029 earnings at $1.19 EPS and FY2029 earnings at $4.36 EPS.

CarMax (NYSE:KMX - Get Free Report) last released its quarterly earnings results on Tuesday, September 29th. The company reported $1.16 earnings per share for the quarter, topping the consensus estimate of $0.73 by $0.43. CarMax had a net margin of 1.06% and a return on equity of 7.76%. The business had revenue of $7.88 billion for the quarter, compared to the consensus estimate of $7.09 billion. During the same period last year, the firm earned $0.64 earnings per share. The company's quarterly revenue was up 19.5% on a year-over-year basis.

KMX has been the subject of several other research reports. Robert W. Baird upped their target price on shares of CarMax from $64.00 to $70.00 and gave the stock an "outperform" rating in a report on Wednesday, September 30th. Barclays lifted their target price on CarMax from $61.00 to $67.00 and gave the company an "equal weight" rating in a research note on Wednesday, September 30th. Bank of America raised CarMax from an "underperform" rating to a "buy" rating and boosted their price target for the stock from $50.00 to $65.00 in a report on Thursday. Truist Financial boosted their price target on CarMax from $50.00 to $60.00 and gave the stock a "hold" rating in a report on Wednesday, September 30th. Finally, UBS Group set a $65.00 price target on CarMax in a research note on Thursday. One investment analyst has rated the stock with a Strong Buy rating, three have assigned a Buy rating, thirteen have given a Hold rating and two have assigned a Sell rating to the stock. Based on data from MarketBeat.com, the stock presently has an average rating of "Hold" and a consensus target price of $57.85.

CarMax Stock Performance

NYSE:KMX opened at $53.29 on Monday. The stock has a 50-day simple moving average of $58.32 and a two-hundred day simple moving average of $51.26. The firm has a market capitalization of $7.56 billion, a PE ratio of 26.00, a P/E/G ratio of 1.50 and a beta of 1.23. The company has a debt-to-equity ratio of 2.66, a quick ratio of 0.57 and a current ratio of 2.33. CarMax has a 52-week low of $30.26 and a 52-week high of $65.28.

Hedge Funds Weigh In On CarMax

Institutional investors and hedge funds have recently made changes to their positions in the business. Global Retirement Partners LLC bought a new position in shares of CarMax in the 2nd quarter valued at about $29,000. Basecamp Wealth Advisors LLC grew its position in CarMax by 105.8% in the first quarter. Basecamp Wealth Advisors LLC now owns 636 shares of the company's stock worth $26,000 after acquiring an additional 327 shares in the last quarter. Anchor Investment Management LLC purchased a new position in CarMax in the second quarter worth about $37,000. Wellington Grp LLC increased its stake in CarMax by 6,500.0% during the first quarter. Wellington Grp LLC now owns 726 shares of the company's stock worth $30,000 after acquiring an additional 715 shares during the last quarter. Finally, Aberdeen Wealth Management LLC bought a new stake in CarMax during the second quarter worth approximately $39,000.

Key CarMax News

Here are the key news stories impacting CarMax this week:

• Positive Sentiment: Bank of America upgraded CarMax to Buy from Underperform and raised its price target to $65 from $50. The firm cited CarMax’s improved price competitiveness, cost reductions and expected market-share gains. It also believes enforcement of the Federal Trade Commission’s price-transparency rules could provide a lasting sales benefit. BofA Securities Upgrades CarMax to Buy From Underperform, Adjusts Price Target to $65 From $50
• Positive Sentiment: Zacks upgraded KMX to Rank #1, or Strong Buy, reflecting increased optimism about the company’s earnings outlook. CarMax was also included on Zacks’ list of top value stocks, which may attract additional value-oriented interest. CarMax Upgraded to Strong Buy: Here's Why
• Positive Sentiment: Zacks Research raised numerous CarMax earnings forecasts, including estimates for fiscal 2027, fiscal 2028 and fiscal 2029. Its FY2029 EPS projection increased to $4.25 from $2.91, while FY2027 and FY2028 estimates rose to $3.39 and $3.68, respectively. These revisions reinforce expectations for improving profitability. CarMax Earnings Estimate Revisions
• Neutral Sentiment: Recent analysis compares CarMax with Genuine Parts and other retail-wholesale companies on valuation and year-to-date performance. The coverage may influence how investors assess KMX’s relative value, but it does not represent a new company operating update. KMX vs. GPC: Which Stock Is the Better Value Option?
• Negative Sentiment: CarMax had recently fallen sharply, losing 15.3% over four weeks before the latest rebound. Although technical indicators showed the stock as oversold and earnings revisions suggested a potential reversal, the decline highlights continued volatility and investor sensitivity to the company’s outlook. CarMax Loses 15.3% in 4 Weeks

About CarMax

CarMax, Inc is a retailer of used vehicles operating in the United States. The company sells a broad selection of used cars, trucks and SUVs through its dealership network and online platform, offering customers the ability to research, purchase and arrange delivery for vehicles through an omnichannel shopping experience.

In addition to retail vehicle sales, CarMax provides vehicle financing through CarMax Auto Finance and offers customers access to extended protection products and related services.

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