Primecap Management Co. CA Invests $230.55 Million in CarMax, Inc. $KMX

Key Points

• Primecap Management initiated a $230.55 million position in CarMax, purchasing 4.36 million shares and acquiring approximately 3.07% of the company. Several other institutional investors also established new stakes during the second quarter.
• CarMax insiders bought 13,900 shares worth approximately $735,574 over the past 90 days, including purchases by CEO Keith Barr and director Sona Chawla.
• CarMax’s latest quarterly results exceeded expectations, with adjusted EPS of $1.31 versus the $0.96 consensus and revenue of $8.01 billion. Analysts maintain a consensus “Hold” rating with an average price target of $51, while shares recently traded near a 52-week high at $64.17.

Primecap Management Co. CA bought a new position in CarMax, Inc. (NYSE:KMX - Free Report) during the 2nd quarter, according to its most recent Form 13F filing with the Securities and Exchange Commission (SEC). The firm bought 4,359,016 shares of the company's stock, valued at approximately $230,548,000. Primecap Management Co. CA owned about 3.07% of CarMax as of its most recent filing with the Securities and Exchange Commission (SEC).

Other institutional investors have also recently bought and sold shares of the company. Canada Pension Plan Investment Board acquired a new position in CarMax during the second quarter worth approximately $115,465,000. Legal & General Group Plc purchased a new position in CarMax during the second quarter worth approximately $18,749,000. The Manufacturers Life Insurance Company acquired a new position in shares of CarMax in the 2nd quarter valued at $128,001,000. Broad Run Investment Management LLC acquired a new position in shares of CarMax in the 2nd quarter valued at $14,980,000. Finally, Aberdeen Wealth Management LLC purchased a new stake in shares of CarMax during the 2nd quarter valued at $39,000.

Insider Buying and Selling at CarMax

In other news, Director Sona Chawla purchased 2,000 shares of the stock in a transaction that occurred on Thursday, June 25th. The stock was acquired at an average cost of $53.39 per share, with a total value of $106,780.00. Following the acquisition, the director owned 21,702 shares in the company, valued at approximately $1,158,669.78. This trade represents a 10.15% increase in their ownership of the stock. The acquisition was disclosed in a document filed with the SEC, which can be accessed through this hyperlink. Also, CEO Keith Barr purchased 9,400 shares of the company's stock in a transaction that occurred on Monday, June 22nd. The shares were purchased at an average cost of $53.01 per share, for a total transaction of $498,294.00. Following the purchase, the chief executive officer directly owned 33,375 shares in the company, valued at $1,769,208.75. This trade represents a 39.21% increase in their ownership of the stock. The SEC filing for this purchase provides additional information. Insiders bought 13,900 shares of company stock valued at $735,574 over the last 90 days. 1.01% of the stock is owned by corporate insiders.

Analyst Ratings Changes

Several brokerages recently weighed in on KMX. Wall Street Zen raised CarMax from a "sell" rating to a "hold" rating in a research report on Saturday, June 13th. Truist Financial lifted their price objective on CarMax from $47.00 to $50.00 and gave the company a "hold" rating in a research note on Thursday, June 18th. Mizuho boosted their target price on CarMax from $38.00 to $43.00 and gave the stock a "neutral" rating in a report on Thursday, June 18th. Morgan Stanley increased their target price on shares of CarMax from $35.00 to $44.00 and gave the stock an "equal weight" rating in a research report on Tuesday, June 23rd. Finally, Barclays upgraded shares of CarMax from an "underweight" rating to an "equal weight" rating and raised their price target for the company from $37.00 to $61.00 in a report on Tuesday, July 21st. One investment analyst has rated the stock with a Strong Buy rating, two have issued a Buy rating, fourteen have assigned a Hold rating and three have issued a Sell rating to the company. According to MarketBeat, the company presently has an average rating of "Hold" and a consensus target price of $51.00.

CarMax Price Performance

Shares of NYSE KMX opened at $64.17 on Wednesday. CarMax, Inc. has a 1-year low of $30.26 and a 1-year high of $64.59. The business has a 50-day moving average of $56.11 and a 200-day moving average of $47.24. The company has a debt-to-equity ratio of 2.87, a current ratio of 2.70 and a quick ratio of 0.82. The company has a market capitalization of $9.11 billion, a price-to-earnings ratio of 41.94, a PEG ratio of 2.87 and a beta of 1.15.

CarMax (NYSE:KMX - Get Free Report) last announced its earnings results on Wednesday, June 17th. The company reported $1.31 EPS for the quarter, beating the consensus estimate 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 return on equity of 6.64% and a net margin of 0.84%.The company's revenue was up 6.2% on a year-over-year basis. During the same period last year, the business posted $1.38 EPS. On average, equities analysts anticipate that CarMax, Inc. will post 2.73 EPS for the current fiscal year.

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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