KMX gets a fundamental rating of 3 out of 10. The analysis compared the fundamentals against 122 industry peers in the Specialty Retail industry. KMX may be in some trouble as it scores bad on both profitability and health. KMX has a decent growth rate and is not valued too expensively.

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

KMX had positive earnings in the past year.
KMX had a positive operating cash flow in the past year.
In the past 5 years KMX has always been profitable.
Of the past 5 years KMX 4 years had a positive operating cash flow.

1.2 Ratios

KMX has a Return On Assets (1.79%) which is comparable to the rest of the industry.
KMX has a better Return On Equity (7.55%) than 63.11% of its industry peers.
KMX's Return On Invested Capital of 0.49% is in line compared to the rest of the industry. KMX outperforms 40.16% of its industry peers.
The Average Return On Invested Capital over the past 3 years for KMX is significantly below the industry average of 12.24%.

		Industry Rank	Sector Rank
ROA	1.79%
ROE	7.55%
ROIC	0.49%

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

KMX has a Profit Margin of 1.77%. This is comparable to the rest of the industry: KMX outperforms 59.02% of its industry peers.
In the last couple of years the Profit Margin of KMX has declined.
The Operating Margin of KMX (0.59%) is comparable to the rest of the industry.
In the last couple of years the Operating Margin of KMX has declined.
With a Gross Margin value of 11.06%, KMX is not doing good in the industry: 90.16% of the companies in the same industry are doing better.
In the last couple of years the Gross Margin of KMX has declined.

		Industry Rank	Sector Rank
OM	0.59%
PM (TTM)	1.77%
GM	11.06%

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%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so KMX is destroying value.
Compared to 1 year ago, KMX has less shares outstanding
The number of shares outstanding for KMX has been reduced compared to 5 years ago.
Compared to 1 year ago, KMX has an improved debt to assets ratio.

2.2 Solvency

Based on the Altman-Z score of 1.57, we must say that KMX is in the distress zone and has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of 1.57, KMX is doing worse than 64.75% of the companies in the same industry.
KMX has a debt to FCF ratio of 8.99. This is a slightly negative value and a sign of low solvency as KMX would need 8.99 years to pay back of all of its debts.
KMX has a Debt to FCF ratio (8.99) which is comparable to the rest of the industry.
KMX has a Debt/Equity ratio of 2.76. This is a high value indicating a heavy dependency on external financing.
Looking at the Debt to Equity ratio, with a value of 2.76, KMX is doing worse than 72.13% of the companies in the same industry.

		Industry Rank	Sector Rank
Debt/Equity	2.76
Debt/FCF	8.99
Altman-Z	1.57

ROIC/WACC0.11

WACC4.37%

2.3 Liquidity

A Current Ratio of 1.99 indicates that KMX should not have too much problems paying its short term obligations.
KMX has a Current ratio of 1.99. This is in the better half of the industry: KMX outperforms 79.51% of its industry peers.
A Quick Ratio of 0.51 indicates that KMX may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.51, KMX is in line with its industry, outperforming 49.18% of the companies in the same industry.

		Industry Rank	Sector Rank
Current Ratio	1.99
Quick Ratio	0.51

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

The Earnings Per Share has been growing slightly by 4.75% over the past year.
KMX shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -9.31% yearly.
Looking at the last year, KMX shows a decrease in Revenue. The Revenue has decreased by -0.15% in the last year.
KMX shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 5.34% yearly.

EPS 1Y (TTM)4.75%

EPS 3Y-22.26%

EPS 5Y-9.31%

EPS Q2Q%-46.91%

Revenue 1Y (TTM)-0.15%

Revenue growth 3Y-6.17%

Revenue growth 5Y5.34%

Sales Q2Q%-6.9%

3.2 Future

Based on estimates for the next years, KMX will show a very strong growth in Earnings Per Share. The EPS will grow by 24.00% on average per year.
The Revenue is expected to grow by 1.32% on average over the next years.

EPS Next Y-18.42%

EPS Next 2Y-12.58%

EPS Next 3Y-2.46%

EPS Next 5Y24%

Revenue Next Year-2.77%

Revenue Next 2Y-1.21%

Revenue Next 3Y-0.09%

Revenue Next 5Y1.32%

3.3 Evolution

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.

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4. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings ratio is 14.41, which indicates a correct valuation of KMX.
Based on the Price/Earnings ratio, KMX is valued a bit cheaper than 77.05% of the companies in the same industry.
When comparing the Price/Earnings ratio of KMX to the average of the S&P500 Index (28.30), we can say KMX is valued slightly cheaper.
Based on the Price/Forward Earnings ratio of 17.82, the valuation of KMX can be described as rather expensive.
Based on the Price/Forward Earnings ratio, KMX is valued a bit cheaper than 64.75% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 25.57, KMX is valued a bit cheaper.

		Industry Rank	Sector Rank
PE	14.41
Fwd PE	17.82

4.2 Price Multiples

Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of KMX indicates a slightly more expensive valuation: KMX is more expensive than 68.03% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, KMX is valued cheaper than 97.54% of the companies in the same industry.