Midway Capital Research & Management Makes New $1.62 Million Investment in CarMax, Inc. $KMX

Key Points

• Midway Capital Research & Management opened a new position in CarMax during the fourth quarter, buying 42,051 shares worth about $1.62 million. The stake now represents roughly 1.6% of its portfolio.
• CarMax reported better-than-expected quarterly results, with EPS of $1.31 versus $0.96 expected and revenue of $8.01 billion versus $7.42 billion expected. Revenue rose 6.2% year over year, though profit margins remain under pressure.
• Analysts have become somewhat more constructive after the earnings beat, with several raising price targets, but sentiment is still mixed. MarketBeat shows an overall “Reduce” rating and an average price target of $46.13, below the recent stock price of $53.54.

Midway Capital Research & Management acquired a new position in CarMax, Inc. (NYSE:KMX - Free Report) in the fourth quarter, according to the company in its most recent filing with the Securities & Exchange Commission. The institutional investor acquired 42,051 shares of the company's stock, valued at approximately $1,625,000. CarMax makes up approximately 1.6% of Midway Capital Research & Management's investment portfolio, making the stock its 28th biggest holding.

Other institutional investors and hedge funds have also made changes to their positions in the company. Huntington National Bank increased its position in CarMax by 62.4% during the 4th quarter. Huntington National Bank now owns 690 shares of the company's stock valued at $27,000 after buying an additional 265 shares in the last quarter. CYBER HORNET ETFs LLC bought a new stake in CarMax in the 2nd quarter worth approximately $28,000. MUFG Securities EMEA plc bought a new stake in shares of CarMax in the second quarter worth $30,000. Advisory Services Network LLC purchased a new stake in shares of CarMax during the 3rd quarter valued at about $32,000. Finally, Commonwealth Retirement Investments LLC purchased a new stake in CarMax during the fourth quarter valued at approximately $33,000.

CarMax Stock Down 0.2%

NYSE:KMX opened at $53.54 on Friday. The company has a market cap of $7.59 billion, a price-to-earnings ratio of 34.99, a price-to-earnings-growth ratio of 1.97 and a beta of 1.21. The company has a current ratio of 2.70, a quick ratio of 0.49 and a debt-to-equity ratio of 2.87. CarMax, Inc. has a twelve month low of $30.26 and a twelve month high of $71.99. The stock has a fifty day simple moving average of $42.75 and a 200-day simple moving average of $42.64.

CarMax (NYSE:KMX - Get Free Report) last issued its earnings results on Wednesday, June 17th. The company reported $1.31 EPS for the quarter, topping analysts' consensus estimates of $0.96 by $0.35. The business had revenue of $8.01 billion for the quarter, compared to the consensus estimate of $7.42 billion. CarMax had a net margin of 0.84% and a return on equity of 6.64%. The company's revenue for the quarter was up 6.2% compared to the same quarter last year. During the same period in the prior year, the firm earned $1.38 EPS. Analysts anticipate that CarMax, Inc. will post 2.37 EPS for the current year.

Wall Street Analyst Weigh In

A number of analysts have commented on KMX shares. Barclays set a $37.00 price target on CarMax in a research report on Thursday. Weiss Ratings reiterated a "sell (d)" rating on shares of CarMax in a report on Wednesday, April 8th. Robert W. Baird lifted their price objective on CarMax from $48.00 to $55.00 and gave the stock an "outperform" rating in a research note on Thursday. Evercore set a $45.00 target price on shares of CarMax in a research report on Friday, April 10th. Finally, Bank of America increased their price target on CarMax from $40.00 to $45.00 and gave the company an "underperform" rating in a report on Wednesday. Two investment analysts have rated the stock with a Buy rating, thirteen have issued a Hold rating and five have assigned a Sell rating to the company's stock. According to MarketBeat, the company currently has an average rating of "Reduce" and an average price target of $46.13.

CarMax News Summary

Here are the key news stories impacting CarMax this week:

• Positive Sentiment: Several analysts raised price targets and turned more constructive after CarMax reported better-than-expected results, citing signs of progress in sales growth, cost control, and customer experience under the new CEO. KMX Stock Recoups Earnings Day Losses – Analysts Pour Praise On New CarMax CEO’s Focus On Cost And Customer Experience
• Positive Sentiment: Stephens upgraded CarMax to overweight with a $66 target, and Mizuho lifted its target to $43, reflecting improved sentiment around the company’s Q1 beat and its new four-pillar strategy focused on pricing, digital simplification, cost discipline, and finance penetration. CarMax Analysts Boost Their Forecasts After Upbeat Q1 Results
• Positive Sentiment: The company beat Q1 earnings and revenue estimates on stronger wholesale and retail sales, plus lower SG&A costs, which reassured investors that operational reforms are starting to work. CarMax Q1 Earnings Beat Estimates on Revenue Growth, Cost Control
• Neutral Sentiment: Recent commentary from investors and analysts suggests the turnaround is taking shape, but many want more proof that margin pressure is easing and that the strategy can translate into sustained profit growth. CarMax’s Turnaround Is Taking Shape, Still Has Long Way to Go
• Negative Sentiment: Despite the strong revenue beat, CarMax’s profit and margins remain under pressure, which is keeping some investors cautious and limiting enthusiasm for the stock’s near-term upside. Why CarMax Stock Plummeted Today

About CarMax

CarMax NYSE: KMX is a leading retailer of used vehicles in the United States, offering customers a streamlined, no-haggle purchasing experience. The company's inventory spans a broad range of makes and models, each of which undergoes a comprehensive inspection process before being offered for sale. Customers can shop in person at CarMax's retail locations or browse the company's online platform, which provides detailed vehicle histories, virtual tours and contactless purchasing options.

Originally launched in 1993 as a division of Circuit City, CarMax became an independent, publicly traded company in 1997.

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