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 3 out of 10. We evaluated KMX against 120 industry peers in the Specialty Retail industry. There are concerns on the financial health of KMX while its profitability can be described as average. KMX has a correct valuation and a medium 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.
In the past 5 years KMX has always been profitable.
KMX had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
KMX's Return On Assets of 1.83% is in line compared to the rest of the industry. KMX outperforms 55.83% of its industry peers.
With a decent Return On Equity value of 8.02%, KMX is doing good in the industry, outperforming 64.17% 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 60.83% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for KMX is significantly below the industry average of 13.00%.
The 3 year average ROIC (0.57%) for KMX is below the current ROIC(0.62%), indicating increased profibility in the last year.
| 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.
KMX has a Operating Margin (0.79%) which is comparable to the rest of the industry.
KMX's Operating Margin has declined in the last couple of years.
The Gross Margin of KMX (11.00%) is worse than 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
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
The debt/assets ratio for KMX has been reduced compared to a year ago.
2.2 Solvency
KMX has an Altman-Z score of 1.60. 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 (1.60) is worse than 65.83% of its industry peers.
The Debt to FCF ratio of KMX is 120.67, which is on the high side as it means it would take KMX, 120.67 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of KMX (120.67) is worse than 60.00% of its industry peers.
A Debt/Equity ratio of 2.94 is on the high side and indicates that KMX has dependencies on debt financing.
The Debt to Equity ratio of KMX (2.94) is worse than 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
WACC5.69%
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 85.83% of the companies in the same industry.
A Quick Ratio of 0.52 indicates that KMX may have some problems paying its short term obligations.
KMX has a Quick ratio of 0.52. This is comparable to the rest of the industry: KMX outperforms 48.33% 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.
The Revenue has decreased by -0.69% in the past year.
Measured over the past years, KMX shows a small growth in Revenue. The Revenue has been growing by 5.34% on average per year.
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
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 stable.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 19.25 indicates a rather expensive valuation of KMX.
Based on the Price/Earnings ratio, KMX is valued a bit cheaper than 66.67% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 25.91, KMX is valued a bit cheaper.
KMX is valuated correctly with a Price/Forward Earnings ratio of 16.74.
Compared to the rest of the industry, the Price/Forward Earnings ratio of KMX indicates a somewhat cheap valuation: KMX is cheaper than 62.50% of the companies listed in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 21.77. KMX is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.25 | ||
| Fwd PE | 16.74 |
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.
KMX's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 61.28 | ||
| EV/EBITDA | 55.95 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
KMX's earnings are expected to grow with 18.98% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.28
PEG (5Y)N/A
EPS Next 2Y15.82%
EPS Next 3Y18.98%
5. Dividend
5.1 Amount
KMX does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
62.96
+0.69 (+1.11%)
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 Cap9.59B
Analysts78.18
Price Target84.45 (34.13%)
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 | 19.25 | ||
| Fwd PE | 16.74 | ||
| P/S | 0.36 | ||
| P/FCF | 61.28 | ||
| P/OCF | 15.36 | ||
| P/B | 1.54 | ||
| P/tB | 1.57 | ||
| EV/EBITDA | 55.95 |
EPS(TTM)3.27
EY5.19%
EPS(NY)3.76
Fwd EY5.97%
FCF(TTM)1.03
FCFY1.63%
OCF(TTM)4.1
OCFY6.51%
SpS173
BVpS40.98
TBVpS40.06
PEG (NY)1.28
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
WACC5.69%
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