CARMAX INC (KMX) Stock Fundamental Analysis
NYSE:KMX - New York Stock Exchange, Inc. - US1431301027 - Common Stock - Currency: USD
Taking everything into account, KMX scores 4 out of 10 in our fundamental rating. KMX was compared to 121 industry peers in the Specialty Retail industry. KMX has only an average score on both its financial health and profitability. KMX is quite expensive at the moment. It does show a decent growth rate.
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.
Each year in the past 5 years KMX has been profitable.
KMX had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
KMX has a Return On Assets of 1.83%. This is comparable to the rest of the industry: KMX outperforms 56.20% of its industry peers.
Looking at the Return On Equity, with a value of 8.02%, KMX is in the better half of the industry, outperforming 65.29% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 0.62%, KMX is doing worse than 61.98% of the companies in the same industry.
KMX had an Average Return On Invested Capital over the past 3 years of 0.57%. This is significantly below the industry average of 13.08%.
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
KMX has a Profit Margin (1.90%) which is in line with its industry peers.
KMX's Profit Margin has declined in the last couple of years.
With a Operating Margin value of 0.79%, KMX perfoms like the industry average, outperforming 40.50% of the companies in the same industry.
KMX's Operating Margin has declined in the last couple of years.
With a Gross Margin value of 11.00%, KMX is not doing good in the industry: 94.21% 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 | 0.79% | ||
| 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
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so 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.
KMX has a better debt/assets ratio than last year.
2.2 Solvency
KMX has an Altman-Z score of 1.62. This is a bad value and indicates that KMX is not financially healthy and even has some risk of bankruptcy.
KMX has a worse Altman-Z score (1.62) than 63.64% 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.
Looking at the Debt to FCF ratio, with a value of 120.67, KMX is in line with its industry, outperforming 40.50% of the companies in the same industry.
A Debt/Equity ratio of 2.94 is on the high side and indicates that KMX has dependencies on debt financing.
With a Debt to Equity ratio value of 2.94, KMX is not doing good in the industry: 73.55% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.94 | ||
| Debt/FCF | 120.67 | ||
| Altman-Z | 1.62 |
ROIC/WACC0.11
WACC5.84%
2.3 Liquidity
A Current Ratio of 2.31 indicates that KMX has no problem at all paying its short term obligations.
With an excellent Current ratio value of 2.31, KMX belongs to the best of the industry, outperforming 86.78% of the companies in the same industry.
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.
KMX's Quick ratio of 0.52 is in line compared to the rest of the industry. KMX outperforms 48.76% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.31 | ||
| Quick Ratio | 0.52 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 18.91% over the past year.
The Earnings Per Share has been decreasing by -9.31% on average over the past years.
KMX shows a decrease in Revenue. In the last year, the revenue decreased by -0.69%.
KMX shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 5.34% yearly.
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 Y15.23%
EPS Next 2Y16.52%
EPS Next 3Y17.63%
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
The Price/Earnings ratio is 20.40, which indicates a rather expensive current valuation of KMX.
65.29% of the companies in the same industry are more expensive than KMX, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 28.22, KMX is valued a bit cheaper.
KMX is valuated rather expensively with a Price/Forward Earnings ratio of 17.70.
Compared to the rest of the industry, the Price/Forward Earnings ratio of KMX indicates a somewhat cheap valuation: KMX is cheaper than 63.64% of the companies listed in the same industry.
When comparing the Price/Forward Earnings ratio of KMX to the average of the S&P500 Index (20.86), we can say KMX is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.4 | ||
| Fwd PE | 17.7 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, KMX is valued a bit more expensive than 66.94% of the companies in the same industry.
The rest of the industry has a similar Price/Free Cash Flow ratio as KMX.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 65.08 | ||
| EV/EBITDA | 57.34 |
4.3 Compensation for Growth
KMX's 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 17.63% in the coming years.
PEG (NY)1.34
PEG (5Y)N/A
EPS Next 2Y16.52%
EPS Next 3Y17.63%
5. Dividend
5.1 Amount
KMX does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
66.71
+1.19 (+1.82%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)
Earnings (Next)
Inst Owners110.68%
Inst Owner Change-1.83%
Ins Owners0.35%
Ins Owner Change4.88%
Market Cap10.19B
Analysts78.18
Price Target84.45 (26.59%)
Short Float %7.13%
Short Ratio3.46
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)-6.5%
PT rev (3m)-5.07%
EPS NQ rev (1m)-3.11%
EPS NQ rev (3m)-3.6%
EPS NY rev (1m)-3.64%
EPS NY rev (3m)-3.58%
Revenue NQ rev (1m)1.35%
Revenue NQ rev (3m)1.95%
Revenue NY rev (1m)0.78%
Revenue NY rev (3m)1.3%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.4 | ||
| Fwd PE | 17.7 | ||
| P/S | 0.39 | ||
| P/FCF | 65.08 | ||
| P/OCF | 16.31 | ||
| P/B | 1.63 | ||
| P/tB | 1.67 | ||
| EV/EBITDA | 57.34 |
EPS(TTM)3.27
EY4.9%
EPS(NY)3.77
Fwd EY5.65%
FCF(TTM)1.03
FCFY1.54%
OCF(TTM)4.09
OCFY6.13%
SpS172.61
BVpS40.89
TBVpS39.96
PEG (NY)1.34
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 | 1.62 |
F-Score7
WACC5.84%
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 Y15.23%
EPS Next 2Y16.52%
EPS Next 3Y17.63%
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 Year53.61%
EBIT Next 3Y29.3%
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