CARMAX INC (KMX) Stock Fundamental Analysis
NYSE:KMX - New York Stock Exchange, Inc. - US1431301027 - Common Stock - Currency: USD
Overall KMX gets a fundamental rating of 4 out of 10. We evaluated KMX against 123 industry peers in the Specialty Retail industry. KMX has an average financial health and profitability rating. KMX is not valued too expensively and it also shows a decent growth rate.
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.
KMX had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
KMX has a Return On Assets (2.04%) which is in line with its industry peers.
KMX has a Return On Equity of 8.88%. This is in the better half of the industry: KMX outperforms 65.85% of its industry peers.
KMX has a Return On Invested Capital (0.85%) which is comparable to the rest of the industry.
Measured over the past 3 years, the Average Return On Invested Capital for KMX is significantly below the industry average of 12.08%.
The 3 year average ROIC (0.57%) for KMX is below the current ROIC(0.85%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.04% | ||
| ROE | 8.88% | ||
| ROIC | 0.85% |
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 2.08%. This is comparable to the rest of the industry: KMX outperforms 59.35% of its industry peers.
In the last couple of years the Profit Margin of KMX has declined.
KMX has a Operating Margin of 1.07%. This is comparable to the rest of the industry: KMX outperforms 46.34% of its industry peers.
KMX's Operating Margin has declined in the last couple of years.
KMX has a Gross Margin of 11.20%. This is amonst the worse of the industry: KMX underperforms 92.68% of its industry peers.
In the last couple of years the Gross Margin of KMX has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 1.07% | ||
| PM (TTM) | 2.08% | ||
| GM | 11.2% |
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
KMX has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
Compared to 1 year ago, KMX has less shares outstanding
Compared to 5 years ago, KMX has less shares outstanding
KMX has a better debt/assets ratio than last year.
2.2 Solvency
KMX has an Altman-Z score of 1.61. This is a bad value and indicates that KMX is not financially healthy and even has some risk of bankruptcy.
The Altman-Z score of KMX (1.61) is worse than 62.60% of its industry peers.
The Debt to FCF ratio of KMX is 35.05, which is on the high side as it means it would take KMX, 35.05 years of fcf income to pay off all of its debts.
With a Debt to FCF ratio value of 35.05, KMX perfoms like the industry average, outperforming 47.97% of the companies in the same industry.
KMX has a Debt/Equity ratio of 2.89. This is a high value indicating a heavy dependency on external financing.
KMX has a Debt to Equity ratio of 2.89. This is in the lower half of the industry: KMX underperforms 73.17% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.89 | ||
| Debt/FCF | 35.05 | ||
| Altman-Z | 1.61 |
ROIC/WACC0.17
WACC5.1%
2.3 Liquidity
A Current Ratio of 2.39 indicates that KMX has no problem at all paying its short term obligations.
The Current ratio of KMX (2.39) is better than 87.80% of its industry peers.
A Quick Ratio of 0.80 indicates that KMX may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.80, KMX is in the better half of the industry, outperforming 69.92% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.39 | ||
| Quick Ratio | 0.8 |
3. Growth
3.1 Past
KMX shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 43.75%, which is quite impressive.
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 small growth in Revenue. The Revenue has grown by 3.17% 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)43.75%
EPS 3Y-22.26%
EPS 5Y-9.31%
EPS Q2Q%42.27%
Revenue 1Y (TTM)3.17%
Revenue growth 3Y-6.17%
Revenue growth 5Y5.34%
Sales Q2Q%6.09%
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 27.57% on average per year.
KMX is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.67% yearly.
EPS Next Y20.6%
EPS Next 2Y17.47%
EPS Next 3Y20.87%
EPS Next 5Y27.57%
Revenue Next Year3.41%
Revenue Next 2Y3.95%
Revenue Next 3Y4.59%
Revenue Next 5Y3.67%
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.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
KMX is valuated correctly with a Price/Earnings ratio of 14.93.
78.05% of the companies in the same industry are more expensive than KMX, based on the Price/Earnings ratio.
When comparing the Price/Earnings ratio of KMX to the average of the S&P500 Index (26.48), we can say KMX is valued slightly cheaper.
KMX is valuated correctly with a Price/Forward Earnings ratio of 12.18.
Compared to the rest of the industry, the Price/Forward Earnings ratio of KMX indicates a somewhat cheap valuation: KMX is cheaper than 71.54% 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 (34.04), we can say KMX is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.93 | ||
| Fwd PE | 12.18 |
4.2 Price Multiples
65.04% of the companies in the same industry are cheaper than KMX, based on the Enterprise Value to EBITDA ratio.
KMX's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. KMX is cheaper than 75.61% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 15.25 | ||
| EV/EBITDA | 45.68 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
A more expensive valuation may be justified as KMX's earnings are expected to grow with 20.87% in the coming years.
PEG (NY)0.72
PEG (5Y)N/A
EPS Next 2Y17.47%
EPS Next 3Y20.87%
5. Dividend
5.1 Amount
No dividends for KMX!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
54.96
-0.29 (-0.52%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)
Earnings (Next)
Inst Owners110.27%
Inst Owner Change-1.2%
Ins Owners0.39%
Ins Owner Change5.69%
Market Cap8.25B
Analysts78.26
Price Target83.58 (52.07%)
Short Float %9.38%
Short Ratio3.96
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)7.35%
Min EPS beat(2)-2.08%
Max EPS beat(2)16.78%
EPS beat(4)2
Avg EPS beat(4)11.18%
Min EPS beat(4)-2.08%
Max EPS beat(4)31.69%
EPS beat(8)4
Avg EPS beat(8)3.16%
EPS beat(12)6
Avg EPS beat(12)3.69%
EPS beat(16)8
Avg EPS beat(16)1.7%
Revenue beat(2)1
Avg Revenue beat(2)-0.03%
Min Revenue beat(2)-0.57%
Max Revenue beat(2)0.5%
Revenue beat(4)3
Avg Revenue beat(4)1.06%
Min Revenue beat(4)-0.57%
Max Revenue beat(4)2.33%
Revenue beat(8)3
Avg Revenue beat(8)-0.69%
Revenue beat(12)4
Avg Revenue beat(12)-2.32%
Revenue beat(16)8
Avg Revenue beat(16)0.17%
PT rev (1m)-0.39%
PT rev (3m)-0.39%
EPS NQ rev (1m)0.84%
EPS NQ rev (3m)-4.31%
EPS NY rev (1m)4.57%
EPS NY rev (3m)4.66%
Revenue NQ rev (1m)-0.28%
Revenue NQ rev (3m)-2.41%
Revenue NY rev (1m)-0.88%
Revenue NY rev (3m)-1.22%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.93 | ||
| Fwd PE | 12.18 | ||
| P/S | 0.31 | ||
| P/FCF | 15.25 | ||
| P/OCF | 7.92 | ||
| P/B | 1.31 | ||
| P/tB | 1.34 | ||
| EV/EBITDA | 45.68 |
EPS(TTM)3.68
EY6.7%
EPS(NY)4.51
Fwd EY8.21%
FCF(TTM)3.6
FCFY6.56%
OCF(TTM)6.94
OCFY12.63%
SpS178.49
BVpS41.89
TBVpS40.95
PEG (NY)0.72
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.04% | ||
| ROE | 8.88% | ||
| ROCE | 1.14% | ||
| ROIC | 0.85% | ||
| ROICexc | 0.86% | ||
| ROICexgc | 0.86% | ||
| OM | 1.07% | ||
| PM (TTM) | 2.08% | ||
| GM | 11.2% | ||
| FCFM | 2.02% |
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-Score8
Asset Turnover0.98
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.89 | ||
| Debt/FCF | 35.05 | ||
| Debt/EBITDA | 30.8 | ||
| Cap/Depr | 164% | ||
| Cap/Sales | 1.87% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 176.34% | ||
| Profit Quality | 96.85% | ||
| Current Ratio | 2.39 | ||
| Quick Ratio | 0.8 | ||
| Altman-Z | 1.61 |
F-Score8
WACC5.1%
ROIC/WACC0.17
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)43.75%
EPS 3Y-22.26%
EPS 5Y-9.31%
EPS Q2Q%42.27%
EPS Next Y20.6%
EPS Next 2Y17.47%
EPS Next 3Y20.87%
EPS Next 5Y27.57%
Revenue 1Y (TTM)3.17%
Revenue growth 3Y-6.17%
Revenue growth 5Y5.34%
Sales Q2Q%6.09%
Revenue Next Year3.41%
Revenue Next 2Y3.95%
Revenue Next 3Y4.59%
Revenue Next 5Y3.67%
EBIT growth 1Y82.98%
EBIT growth 3Y-35.16%
EBIT growth 5Y-23.4%
EBIT Next Year47.76%
EBIT Next 3Y23.46%
EBIT Next 5Y24.6%
FCF growth 1Y427.85%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y83.69%
OCF growth 3YN/A
OCF growth 5YN/A