CARMAX INC (KMX) Stock Fundamental Analysis
NYSE:KMX - New York Stock Exchange, Inc. - US1431301027 - Common Stock - Currency: USD
Taking everything into account, KMX scores 3 out of 10 in our fundamental rating. KMX was compared to 120 industry peers in the Specialty Retail industry. While KMX is still in line with the averages on profitability rating, there are concerns on its financial health. KMX has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
KMX had positive earnings in the past year.
In the past year KMX had a positive cash flow from operations.
KMX had positive earnings in each of the past 5 years.
Of the past 5 years KMX 4 years had a positive operating cash flow.
1.2 Ratios
KMX has a Return On Assets of 1.83%. This is comparable to the rest of the industry: KMX outperforms 55.83% of its industry peers.
KMX's Return On Equity of 8.02% is fine compared to the rest of the industry. KMX outperforms 64.17% of its industry peers.
KMX has a Return On Invested Capital of 0.62%. This is in the lower half of the industry: KMX underperforms 60.83% of its industry peers.
The Average Return On Invested Capital over the past 3 years for KMX is significantly below the industry average of 13.01%.
The last Return On Invested Capital (0.62%) for KMX is above the 3 year average (0.57%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.83% | ||
| ROE | 8.02% | ||
| ROIC | 0.62% |
ROA(3y)1.81%
ROA(5y)2.66%
ROE(3y)8.18%
ROE(5y)12.73%
ROIC(3y)0.57%
ROIC(5y)1.15%
1.3 Margins
With a Profit Margin value of 1.90%, KMX perfoms like the industry average, outperforming 56.67% of the companies in the same industry.
In the last couple of years the Profit Margin of KMX has declined.
KMX's Operating Margin of 0.79% is in line compared to the rest of the industry. KMX outperforms 41.67% of its industry peers.
In the last couple of years the Operating Margin of KMX has declined.
KMX's Gross Margin of 11.00% is on the low side compared to the rest of the industry. KMX is outperformed by 95.00% of its industry peers.
KMX's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 0.79% | ||
| PM (TTM) | 1.9% | ||
| GM | 11% |
OM growth 3Y-30.89%
OM growth 5Y-27.28%
PM growth 3Y-19.26%
PM growth 5Y-15.36%
GM growth 3Y2.19%
GM growth 5Y-3.87%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), KMX is destroying value.
KMX has less shares outstanding than it did 1 year ago.
The number of shares outstanding for KMX has been reduced compared to 5 years ago.
The debt/assets ratio for KMX has been reduced compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of 1.60, we must say that KMX is in the distress zone and has some risk of bankruptcy.
The Altman-Z score of KMX (1.60) is worse than 65.83% of its industry peers.
KMX has a debt to FCF ratio of 120.67. This is a negative value and a sign of low solvency as KMX would need 120.67 years to pay back of all of its debts.
KMX has a Debt to FCF ratio of 120.67. This is in the lower half of the industry: KMX underperforms 60.00% of its industry peers.
KMX has a Debt/Equity ratio of 2.94. This is a high value indicating a heavy dependency on external financing.
KMX's Debt to Equity ratio of 2.94 is on the low side compared to the rest of the industry. KMX is outperformed by 74.17% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.94 | ||
| Debt/FCF | 120.67 | ||
| Altman-Z | 1.6 |
ROIC/WACC0.11
WACC5.68%
2.3 Liquidity
KMX has a Current Ratio of 2.31. This indicates that KMX is financially healthy and has no problem in meeting its short term obligations.
KMX has a better Current ratio (2.31) than 85.83% of its industry peers.
KMX has a Quick Ratio of 2.31. This is a bad value and indicates that KMX is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Quick ratio value of 0.52, KMX perfoms like the industry average, outperforming 50.83% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.31 | ||
| Quick Ratio | 0.52 |
3. Growth
3.1 Past
KMX shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 18.91%, which is quite good.
KMX shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -9.31% yearly.
KMX shows a decrease in Revenue. In the last year, the revenue decreased by -0.69%.
The Revenue has been growing slightly by 5.34% on average over the past years.
EPS 1Y (TTM)18.91%
EPS 3Y-22.26%
EPS 5Y-9.31%
EPS Q2Q%100%
Revenue 1Y (TTM)-0.69%
Revenue growth 3Y-6.17%
Revenue growth 5Y5.34%
Sales Q2Q%6.69%
3.2 Future
The Earnings Per Share is expected to grow by 34.42% on average over the next years. This is a very strong growth
The Revenue is expected to grow by 4.88% on average over the next years.
EPS Next Y15.03%
EPS Next 2Y15.82%
EPS Next 3Y18.98%
EPS Next 5Y34.42%
Revenue Next Year4.69%
Revenue Next 2Y4.94%
Revenue Next 3Y5.49%
Revenue Next 5Y4.88%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 19.10 indicates a rather expensive valuation of KMX.
KMX's Price/Earnings ratio is a bit cheaper when compared to the industry. KMX is cheaper than 67.50% of the companies in the same industry.
KMX's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 26.19.
KMX is valuated correctly with a Price/Forward Earnings ratio of 16.61.
Based on the Price/Forward Earnings ratio, KMX is valued a bit cheaper than the industry average as 64.17% of the companies are valued more expensively.
KMX's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 22.13.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.1 | ||
| Fwd PE | 16.61 |
4.2 Price Multiples
KMX's Enterprise Value to EBITDA ratio is a bit more expensive when compared to the industry. KMX is more expensive than 68.33% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of KMX is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 60.81 | ||
| EV/EBITDA | 56.17 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
A more expensive valuation may be justified as KMX's earnings are expected to grow with 18.98% in the coming years.
PEG (NY)1.27
PEG (5Y)N/A
EPS Next 2Y15.82%
EPS Next 3Y18.98%
5. Dividend
5.1 Amount
No dividends for KMX!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
NYSE:KMX (5/30/2025, 9:30:03 AM)
62.47
-0.53 (-0.84%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)
Earnings (Next)
Inst Owners110.68%
Inst Owner Change-2.16%
Ins Owners0.35%
Ins Owner Change4%
Market Cap9.52B
Analysts78.18
Price Target84.45 (35.18%)
Short Float %7.28%
Short Ratio3.23
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)14.8%
Min EPS beat(2)-2.08%
Max EPS beat(2)31.69%
EPS beat(4)2
Avg EPS beat(4)7.1%
Min EPS beat(4)-2.08%
Max EPS beat(4)31.69%
EPS beat(8)4
Avg EPS beat(8)6.73%
EPS beat(12)6
Avg EPS beat(12)2.59%
EPS beat(16)8
Avg EPS beat(16)4.36%
Revenue beat(2)2
Avg Revenue beat(2)1.25%
Min Revenue beat(2)0.5%
Max Revenue beat(2)1.99%
Revenue beat(4)3
Avg Revenue beat(4)0.64%
Min Revenue beat(4)-2.26%
Max Revenue beat(4)2.33%
Revenue beat(8)4
Avg Revenue beat(8)-0.48%
Revenue beat(12)5
Avg Revenue beat(12)-2.13%
Revenue beat(16)9
Avg Revenue beat(16)1.58%
PT rev (1m)-8.03%
PT rev (3m)-6.85%
EPS NQ rev (1m)0.26%
EPS NQ rev (3m)-3.51%
EPS NY rev (1m)-0.18%
EPS NY rev (3m)-3.75%
Revenue NQ rev (1m)0.67%
Revenue NQ rev (3m)1.95%
Revenue NY rev (1m)0%
Revenue NY rev (3m)1.18%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.1 | ||
| Fwd PE | 16.61 | ||
| P/S | 0.36 | ||
| P/FCF | 60.81 | ||
| P/OCF | 15.24 | ||
| P/B | 1.52 | ||
| P/tB | 1.56 | ||
| EV/EBITDA | 56.17 |
EPS(TTM)3.27
EY5.23%
EPS(NY)3.76
Fwd EY6.02%
FCF(TTM)1.03
FCFY1.64%
OCF(TTM)4.1
OCFY6.56%
SpS173
BVpS40.98
TBVpS40.06
PEG (NY)1.27
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.83% | ||
| ROE | 8.02% | ||
| ROCE | 0.82% | ||
| ROIC | 0.62% | ||
| ROICexc | 0.62% | ||
| ROICexgc | 0.63% | ||
| OM | 0.79% | ||
| PM (TTM) | 1.9% | ||
| GM | 11% | ||
| FCFM | 0.59% |
ROA(3y)1.81%
ROA(5y)2.66%
ROE(3y)8.18%
ROE(5y)12.73%
ROIC(3y)0.57%
ROIC(5y)1.15%
ROICexc(3y)0.58%
ROICexc(5y)1.16%
ROICexgc(3y)0.58%
ROICexgc(5y)1.16%
ROCE(3y)0.76%
ROCE(5y)1.54%
ROICexcg growth 3Y-35.83%
ROICexcg growth 5Y-27.01%
ROICexc growth 3Y-35.83%
ROICexc growth 5Y-27.09%
OM growth 3Y-30.89%
OM growth 5Y-27.28%
PM growth 3Y-19.26%
PM growth 5Y-15.36%
GM growth 3Y2.19%
GM growth 5Y-3.87%
F-Score7
Asset Turnover0.96
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.94 | ||
| Debt/FCF | 120.67 | ||
| Debt/EBITDA | 36.46 | ||
| Cap/Depr | 158.73% | ||
| Cap/Sales | 1.78% | ||
| Interest Coverage | 1.98 | ||
| Cash Conversion | 124.23% | ||
| Profit Quality | 31.27% | ||
| Current Ratio | 2.31 | ||
| Quick Ratio | 0.52 | ||
| Altman-Z | 1.6 |
F-Score7
WACC5.68%
ROIC/WACC0.11
Cap/Depr(3y)165.6%
Cap/Depr(5y)135.54%
Cap/Sales(3y)1.65%
Cap/Sales(5y)1.36%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)18.91%
EPS 3Y-22.26%
EPS 5Y-9.31%
EPS Q2Q%100%
EPS Next Y15.03%
EPS Next 2Y15.82%
EPS Next 3Y18.98%
EPS Next 5Y34.42%
Revenue 1Y (TTM)-0.69%
Revenue growth 3Y-6.17%
Revenue growth 5Y5.34%
Sales Q2Q%6.69%
Revenue Next Year4.69%
Revenue Next 2Y4.94%
Revenue Next 3Y5.49%
Revenue Next 5Y4.88%
EBIT growth 1Y-21.65%
EBIT growth 3Y-35.16%
EBIT growth 5Y-23.4%
EBIT Next Year47.76%
EBIT Next 3Y23.46%
EBIT Next 5Y31.99%
FCF growth 1Y2439.31%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y36.16%
OCF growth 3YN/A
OCF growth 5YN/A