CarMax Q4 Earnings Preview: Analyst Estimates, Multi-Year Recovery, Key Items To Watch

Automotive retailer CarMax Inc KMX reports fourth-quarter (Q4) financial results Thursday, April 11 before market open.

Here are the key earnings estimates, what analysts are saying and key items to watch for investors.

Earnings Estimates: Analysts expect CarMax to report Q4 revenue of $5.795 billion according to data from Benzinga Pro.

The estimate would be an improvement over last year's Q4 total of $5.723 billion. The company saw revenue down 5.5% year-over-year in the third quarter. CarMax beat revenue estimates from analysts in two of the last six quarters.

Analysts expect the company to report Q4 earnings per share of 49 cents. That would be an improvement from the 44 cents in the same period last year. The company has beaten earnings per share estimates from analysts in three of the last four quarters.

What Analysts are Saying: Early positive data for CarMax's Q4 recently led to Needham analyst Chris Pierce upgrading shares from Hold to Buy.

Pierce, who has a price target of $99 on CarMax, said the recovery for the company is growing and easy comparable sales from last year's fourth quarter could help the company.

CarMax may see market share growth in Q4 alongside a multi-year recovery path, analysts say.

Here are other recent analyst ratings and price targets for CarMax.

• Oppenheimer: Outperform rating, $105 price target
• RBC Capital: Outperform rating, $83 price target
• Wedbush: Outperform rating, raised price target from $90 to $100
• Evercore ISI Group: In-Line rating, raised price target from $78 to $85
• Mizuho: Neutral rating, $80 price target

Related Link: ‘Mild Recession’ To Hit Homebuilders, Auto Stocks In Second Half Of 2024, Analyst Says

Key Items to Watch: The fourth quarter report and commentary from CarMax could provide an overall look at how the used car sector is performing.

Investors and analysts will also be watching to see how ecommerce investments and efforts from the company are shaping up.

The company’s Q4 retail openings included New York City, Chicago and Los Angeles. Early data from these markets and additional regions planned could be a key item to watch.

Cost reductions have been a key focus of the company and the fourth quarter could continue to highlight this effort by the company.

Share repurchases resumed by the company in the third quarter and investors will be looking to see if the company bought more shares back in the fourth quarter.

Another key will be guidance for the next fiscal year.

KMX Price Action: CarMax shares are down 4% to $80.02 on Wednesday versus a 52-week trading range of $59.66 to $88.22. Shares of the car retailer are up 21% over the last year.

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