(KMX) CarMax - Overview
Sector: Consumer Cyclical | Industry: Auto & Truck Dealerships | Exchange: NYSE (USA) | Market Cap: 5.764m USD | Total Return: -29.2% in 12m
Avg Turnover: 106M
EPS Trend: -4.2%
Qual. Beats: -1
Rev. Trend: -65.4%
Qual. Beats: 1
Warnings
High Debt/EBITDA (11.4) with thin interest coverage (1.4)
Extended 1w
Tailwinds
Idiosyncratic Leader
CarMax, Inc. is a leading U.S. retailer specializing in the used vehicle market through a dual-segment business model. The Sales Operations segment manages the inventory lifecycle, including the procurement, reconditioning, and sale of domestic and imported vehicles, while also hosting wholesale auctions and providing aftermarket protection plans. The Auto Finance segment facilitates consumer purchases by offering credit solutions across various risk profiles, acting as a captive finance arm to support retail volume.
The company operates within the fragmented automotive retail sector, where a shift toward omnichannel sales allows customers to transition between online browsing and physical dealership fulfillment. Unlike traditional franchised dealers that rely heavily on new car incentives and manufacturer relationships, CarMax’s model focuses on high-volume inventory turnover and a no-haggle pricing strategy to drive market share. For a deeper look into the companys valuation metrics, consider reviewing the data on ValueRay.
Founded in 1993 and headquartered in Richmond, Virginia, CarMax maintains a nationwide footprint of retail locations. Its integrated service offerings, including vehicle repair and third-party financing arrangements, aim to capture multiple revenue streams from a single vehicle transaction.
- Used vehicle sales volume fluctuations driven by consumer affordability and interest rates
- CarMax Auto Finance credit loss provisions impact overall net income margins
- Wholesale auction volume and pricing volatility affect gross profit per unit
- Integration of omnichannel sales platforms influences operational efficiency and market share
- Competitive pricing pressure from online retailers and traditional dealership inventory levels
| Net Income: 247.3m TTM > 0 and > 6% of Revenue |
| FCF/TA: 0.05 > 0.02 and ΔFCF/TA 4.14 > 1.0 |
| NWC/Revenue: 11.19% < 20% (prev 10.93%; Δ 0.26% < -1%) |
| CFO/TA 0.07 > 3% & CFO 1.78b > Net Income 247.3m |
| Net Debt (18.4b) to EBITDA (1.61b): 11.45 < 3 |
| Current Ratio: 2.20 > 1.5 & < 3 |
| Outstanding Shares: last quarter (147.6m) vs 12m ago -5.17% < -2% |
| Gross Margin: 10.84% > 18% (prev 0.11%; Δ 1.07k% > 0.5%) |
| Asset Turnover: 96.26% > 50% (prev 96.17%; Δ 0.10% > 0%) |
| Interest Coverage Ratio: 1.44 > 6 (EBITDA TTM 1.61b / Interest Expense TTM 879.6m) |
| A: 0.11 (Total Current Assets 5.31b - Total Current Liabilities 2.41b) / Total Assets 26.4b |
| B: 0.15 (Retained Earnings 4.04b / Total Assets 26.4b) |
| C: 0.05 (EBIT TTM 1.26b / Avg Total Assets 26.9b) |
| D: 0.20 (Book Value of Equity 4.08b / Total Liabilities 20.5b) |
| Altman-Z'' = 1.74 = BBB |
| DSRI: 1.10 (Receivables 204.5m/188.7m, Revenue 25.9b/26.4b) |
| GMI: 1.01 (GM 10.84% / 11.00%) |
| AQI: 0.98 (AQ_t 0.64 / AQ_t-1 0.66) |
| SGI: 0.98 (Revenue 25.9b / 26.4b) |
| TATA: -0.06 (NI 247.3m - CFO 1.78b) / TA 26.4b) |
| Beneish M = -3.01 (Cap -4..+1) = AA |
As of May 31, 2026, the stock is trading at USD 44.62 with a total of 2,971,479 shares traded.
Over the past week, the price has changed by +14.65%,
over one month by +16.35%,
over three months by +3.36% and
over the past year by -29.17%.
CarMax has received a consensus analysts rating of 3.89. Therefore, it is recommended to buy KMX.
- StrongBuy: 8
- Buy: 4
- Hold: 4
- Sell: 3
- StrongSell: 0
| Analysts Target Price | 42.2 | -5.5% |
P/E Trailing = 24.1905
P/E Forward = 17.094
P/S = 0.2061
P/B = 0.9713
P/EG = 0.4168
Revenue TTM = 25.9b USD
EBIT TTM = 1.26b USD
EBITDA TTM = 1.61b USD
Long Term Debt = 17.3b USD (from longTermDebt, last quarter)
Short Term Debt = 762.0m USD (from shortTermDebt, last quarter)
Debt = 18.5b USD (corrected: LT Debt 17.3b + ST Debt 762.0m) + Leases 522.0m
Net Debt = 18.4b USD (calculated: Debt 18.5b - CCE 122.8m)
Enterprise Value = 24.2b USD (5.76b + Debt 18.5b - CCE 122.8m)
Interest Coverage Ratio = 1.44 (Ebit TTM 1.26b / Interest Expense TTM 879.6m)
EV/FCF = 19.46x (Enterprise Value 24.2b / FCF TTM 1.24b)
FCF Yield = 5.14% (FCF TTM 1.24b / Enterprise Value 24.2b)
FCF Margin = 4.80% (FCF TTM 1.24b / Revenue TTM 25.9b)
Net Margin = 0.96% (Net Income TTM 247.3m / Revenue TTM 25.9b)
Gross Margin = 10.84% ((Revenue TTM 25.9b - Cost of Revenue TTM 23.1b) / Revenue TTM)
Gross Margin QoQ = 10.18% (prev 10.18%)
Tobins Q-Ratio = 0.92 (Enterprise Value 24.2b / Total Assets 26.4b)
Interest Expense / Debt = 4.74% (Interest Expense 879.6m / Debt 18.5b)
Taxrate = 35.51% (136.1m / 383.4m)
NOPAT = 814.6m (EBIT 1.26b * (1 - 35.51%))
Current Ratio = 2.20 (Total Current Assets 5.31b / Total Current Liabilities 2.41b)
Debt / Equity = 3.15 (Debt 18.5b / totalStockholderEquity, last quarter 5.89b)
Debt / EBITDA = 11.45 (Net Debt 18.4b / EBITDA 1.61b)
Debt / FCF = 14.82 (Net Debt 18.4b / FCF TTM 1.24b)
Total Stockholder Equity = 6.11b (last 4 quarters mean from totalStockholderEquity)
RoA = 0.92% (Net Income 247.3m / Total Assets 26.4b)
RoE = 4.05% (Net Income TTM 247.3m / Total Stockholder Equity 6.11b)
RoCE = 5.40% (EBIT 1.26b / Capital Employed (Equity 6.11b + L.T.Debt 17.3b))
RoIC = 3.30% (NOPAT 814.6m / Invested Capital 24.7b)
WACC = 4.73% (E(5.76b)/V(24.3b) * Re(10.09%) + D(18.5b)/V(24.3b) * Rd(4.74%) * (1-Tc(0.36)))
Discount Rate = 10.09% (= CAPM, Blume Beta Adj.)
Shares (quarterly) Correlation: -95.56 | Cagr: -3.19%
[DCF] Terminal Value 77.97% ; FCFF base≈808.3m ; Y1≈926.6m ; Y5≈1.36b
[DCF] Fair Price = 14.81 (EV 20.5b - Net Debt 18.4b = Equity 2.10b / Shares 141.8m; r=8.35% [WACC [floored]]; 5y FCF grow 15.0% → 2.50% )
EPS Correlation: -4.23 | EPS CAGR: -0.96% | SUE: -4.0 | # QB: -1
Revenue Correlation: -65.39 | Revenue CAGR: -1.69% | SUE: 1.14 | # QB: 1
EPS current Quarter (2026-05-31): EPS=0.92 | Chg30d=+0.00% | Revisions=-25% | Analysts=5
EPS next Quarter (2026-08-31): EPS=0.64 | Chg30d=+0.00% | Revisions=+0% | Analysts=5
EPS current Year (2027-02-28): EPS=2.32 | Chg30d=-2.89% | Revisions=-33% | GrowthEPS=+38.2% | GrowthRev=+0.4%
EPS next Year (2028-02-29): EPS=2.72 | Chg30d=-8.98% | Revisions=+0% | GrowthEPS=+17.0% | GrowthRev=+2.3%
[Analyst] Revisions Ratio: -33%