Why America's Car-Mart Stock Is Jumping Today

America's Car-Mart Inc CRMT shares are trading higher in premarket on Thursday after the third-quarter earnings.

The company reported third-quarter FY25 sales growth of 8.7% year-on-year to $325.726 million, beating the analyst consensus estimate of $295.262 million.

The increase in revenue was primarily driven by an increase in retail units sold, partially offset by a 0.9% decrease in the average retail sales price.

Sales volumes increased 13.2%, 13,198 units compared to 11,664 units last year. Average retail sales price declined 0.9% to $19,275.

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Total costs and expenses increased 3.7% to $321.3 million. Selling, general and administrative expenses climbed 6.7% to $46.4 million. 

Total gross profit per retail unit sold was $7,131 compared to $7,043 last year and the profit margin expanded by 150 basis points to 35.7%.

The allowance for credit losses as a percentage of finance receivables—net of deferred revenue and pending accident protection plan claims—decreased to 24.31% as of Jan. 31, down from 24.72% on Oct. 31, 2024.

EPS of $0.37 beat the consensus estimate of $0.10.

Inventory fell 33.9% to $107.5 million. The company held $126.5 million in cash and equivalents as of Jan. 1.

"We continue to strengthen our business by enhancing our financial flexibility, improving our operational and technology capabilities, and adding proven leaders to our team which allowed us to grow volumes, gross margin, and minimize losses during the quarter," said President and CEO Doug Campbell.

Price Action: CRMT shares are trading higher by 8% at $41.45 in premarket at last check Thursday.

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