CarMax stock (KMX:NYE) saw an increase in pre-market trading on Tuesday following the release of its earnings report for the fourth quarter. Earnings for the quarter came in at $0.44 per share, a decrease from $0.98 per share in the same period of the prior year, but still surpassed analysts’ expectations of $0.2.
However, CarMax’s fourth-quarter sales decreased by 25.6% year-over-year to $5.7 billion, missing analysts’ projections of $6.1 billion.
The company intends to expand its operations in FY24 by establishing five new store locations, including two stores in the New York City metropolitan area and its first offsite production location in the Atlanta metropolitan area. CarMax has set aside $450 million for capital expenditures in the fiscal year 2024.
Additionally, the company reaffirmed its long-term goals, intending to sell between 2 million and 2.4 million vehicles and generate between $33 billion and $45 billion in revenue by FY26. In addition, CarMax intends to increase its share of the 0-10-year-old used vehicle market to over 5% by the end of 2025.
Despite the decline in sales during the fourth quarter, investor confidence has been bolstered by strong earnings report of CarMax stock and the expansion plans. It remains to be seen how the company will perform in the coming months as it executes its growth strategy.