What 8 Analyst Ratings Have To Say About CarMax

Across the recent three months, 8 analysts have shared their insights on CarMax KMX, expressing a variety of opinions spanning from bullish to bearish.

The table below provides a snapshot of their recent ratings, showcasing how sentiments have evolved over the past 30 days and comparing them to the preceding months.

Analysts provide deeper insights through their assessments of 12-month price targets, revealing an average target of $84.62, a high estimate of $100.00, and a low estimate of $50.00. Witnessing a positive shift, the current average has risen by 14.74% from the previous average price target of $73.75.

Decoding Analyst Ratings: A Detailed Look

The analysis of recent analyst actions sheds light on the perception of CarMax by financial experts. The following summary presents key analysts, their recent evaluations, and adjustments to ratings and price targets.

Key Insights:

• Action Taken: Analysts respond to changes in market conditions and company performance, frequently updating their recommendations. Whether they 'Maintain', 'Raise' or 'Lower' their stance, it reflects their reaction to recent developments related to CarMax. This information offers a snapshot of how analysts perceive the current state of the company.
• Rating: Unveiling insights, analysts deliver qualitative insights into stock performance, from 'Outperform' to 'Underperform'. These ratings convey expectations for the relative performance of CarMax compared to the broader market.
• Price Targets: Analysts predict movements in price targets, offering estimates for CarMax's future value. Examining the current and prior targets offers insights into analysts' evolving expectations.

To gain a panoramic view of CarMax's market performance, explore these analyst evaluations alongside essential financial indicators. Stay informed and make judicious decisions using our Ratings Table.

Stay up to date on CarMax analyst ratings.

All You Need to Know About CarMax

CarMax sells, finances, and services used and new cars through a chain of over 240 used retail stores. It was formed in 1993 as a unit of Circuit City and spun off into an independent company in late 2002. Used-vehicle sales typically account for about 83% of revenue (78% in fiscal 2023 due to the chip shortage) and wholesale about 13% (20% in fiscal 2023), with the remaining portion composed of extended service plans and repair. In fiscal 2023, the company retailed and wholesaled 807,823, and 585,071 used vehicles, respectively. CarMax is the largest used-vehicle retailer in the US but still estimates that it has only about 4% US market share of vehicles 0-10 years old in 2022. It seeks over 5% share by the end of calendar 2025. CarMax is based in Richmond, Virginia.

Unraveling the Financial Story of CarMax

Market Capitalization Highlights: Above the industry average, the company's market capitalization signifies a significant scale, indicating strong confidence and market prominence.

Decline in Revenue: Over the 3 months period, CarMax faced challenges, resulting in a decline of approximately -5.49% in revenue growth as of 30 November, 2023. This signifies a reduction in the company's top-line earnings. In comparison to its industry peers, the company trails behind with a growth rate lower than the average among peers in the Consumer Discretionary sector.

Net Margin: CarMax's net margin surpasses industry standards, highlighting the company's exceptional financial performance. With an impressive 1.33% net margin, the company effectively manages costs and achieves strong profitability.

Return on Equity (ROE): CarMax's ROE stands out, surpassing industry averages. With an impressive ROE of 1.36%, the company demonstrates effective use of equity capital and strong financial performance.

Return on Assets (ROA): The company's ROA is a standout performer, exceeding industry averages. With an impressive ROA of 0.3%, the company showcases effective utilization of assets.

Debt Management: CarMax's debt-to-equity ratio is below industry norms, indicating a sound financial structure with a ratio of 3.22.

The Core of Analyst Ratings: What Every Investor Should Know

Benzinga tracks 150 analyst firms and reports on their stock expectations. Analysts typically arrive at their conclusions by predicting how much money a company will make in the future, usually the upcoming five years, and how risky or predictable that company's revenue streams are.

Analysts attend company conference calls and meetings, research company financial statements, and communicate with insiders to publish their ratings on stocks. Analysts typically rate each stock once per quarter or whenever the company has a major update.

Some analysts will also offer forecasts for metrics like growth estimates, earnings, and revenue to provide further guidance on stocks. Investors who use analyst ratings should note that this specialized advice comes from humans and may be subject to error.

This article was generated by Benzinga's automated content engine and reviewed by an editor.