CarMax Increases Sales but Misses Estimates on Earnings
CarMax (NYS: KMX) reported earnings on Dec. 21. Here are the numbers you need to know.
The 10-second takeaway
For the quarter ending Nov. 30 (Q3), CarMax met expectations on revenue and missed on earnings per share.
Compared to the prior-year quarter, revenue expanded, and earnings per share were unchanged.
Margins contracted across the board.
CarMax notched revenue of $2.3 billion. The 13 analysts polled by S&P Capital IQ foresaw revenue of $2.3 billion. Sales were 6.8% higher than the prior-year quarter's $2.1 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.
EPS came in at $0.36. The 15 earnings estimates compiled by S&P Capital IQ averaged $0.38 per share. GAAP EPS of $0.36 for Q3 were 0.3% higher than the prior-year quarter's $0.36 per share.
Source: S&P Capital IQ. Quarterly periods. Figures may be non-GAAP to maintain comparability with estimates.
For the quarter, gross margin was 15.7%, 60 basis points worse than the prior-year quarter. Operating margin was 5.7%, 50 basis points worse than the prior-year quarter. Net margin was 3.6%, 20 basis points worse than the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods.
What does the future hold?
Next quarter's average estimate for revenue is $2.4 billion. On the bottom line, the average EPS estimate is $0.40.
Next year's average estimate for revenue is $9.9 billion. The average EPS estimate is $1.82.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 817 members out of 905 rating the stock outperform, and 88 members rating it underperform. Among 315 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 300 give CarMax a green thumbs-up, and 15 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on CarMax is outperform, with an average price target of $35.30.
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At the time this article was published Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.