CarMax Set to Release Q4 Earnings: Analysts Forecast Expectations

CarMax Stock

On April 11, CarMax (KMX:NYE) will release its Q4 FY23 results. Despite some recovery in used car prices this year, the impact of macroeconomic pressures on vehicle affordability is anticipated to weigh on the performance of the company.

In the preceding quarter, CarMax’s revenue decreased by nearly 24% year-over-year to $6.5 billion, and its earnings per share decreased from $1.63 to $0.13. Steven Shemesh, an analyst at RBC Capital, noted that the SAAR for the used vehicle industry was down approximately 1.5% in the February quarter, indicating a slight sequential improvement from the November quarter.

However, Shemesh maintains a cautious outlook on CarMax’s near-term performance due to the ongoing macroeconomic uncertainty. Analysts on Wall Street anticipate that the company’s Q4 FY23 earnings per share (EPS) will decline significantly to $0.20 from $0.98 in the prior-year quarter, and that revenue will decrease by about 21% YoY to $6.11 billion.

 

CarMax Stock Analysis:

CarMax stock currently has a consensus rating of Hold and an average price target of $61.06, indicating a potential downside of 7.3%. Since the beginning of the year, shares have increased by over 5%.

KMX Ratings by Stock Target Advisor

Company Profile:

CarMax, Inc., together with its subsidiaries, operates as a retailer of used vehicles in the United States. The company operates through two segments, CarMax Sales Operations and CarMax Auto Finance.

It offers customers a range of makes and models of used vehicles, including domestic, imported, and luxury vehicles, as well as hybrid and electric vehicles; and extended protection plans to customers at the time of sale, as well as sells vehicles that are approximately 10 years old and has more than 100,000 miles through wholesale auctions.

The company also provides reconditioning and vehicle repair services; and financing alternatives for retail customers across a range of credit spectrum through its CarMax Auto Finance and arrangements with various financial institutions. CarMax, Inc. was founded in 1993 and is based in Richmond, Virginia.

 

Conclusion:

In conclusion, CarMax’s fourth-quarter results may be impacted by high inflation and sluggish consumer spending, prompting Wall Street to maintain a neutral stance on CarMax stock.

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