Taking full advantage of the stock market and investing with confidence are common goals for new and old investors, and Zacks Premium offers many different ways to do both.
The popular research service can help you become a smarter, more self-assured investor, giving you access to daily updates of the Zacks Rank and Zacks Industry Rank, the Zacks #1 Rank List, Equity Research reports, and Premium stock screens.
It also includes access to the Zacks Style Scores.
What are the Zacks Style Scores? The Zacks Style Scores is a unique set of guidelines that rates stocks based on three popular investing types, and were developed as complementary indicators for the Zacks Rank. This combination helps investors choose securities with the highest chances of beating the market over the next 30 days.
Each stock is assigned a rating of A, B, C, D, or F based on their value, growth, and momentum characteristics. Just like in school, an A is better than a B, a B is better than a C, and so on -- that means the better the score, the better chance the stock will outperform.
The Style Scores are broken down into four categories:
Value ScoreFor value investors, it's all about finding good stocks at good prices, and discovering which companies are trading under their true value before the broader market catches on. The Value Style Score utilizes ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and a host of other multiples to help pick out the most attractive and discounted stocks.
Growth ScoreWhile good value is important, growth investors are more focused on a company's financial strength and health, and its future outlook. The Growth Style Score takes projected and historic earnings, sales, and cash flow into account to uncover stocks that will see long-term, sustainable growth.
Momentum ScoreMomentum trading is all about taking advantage of upward or downward trends in a stock's price or earnings outlook, and these investors live by the saying "the trend is your friend." The Momentum Style Score can pinpoint good times to build a position in a stock, using factors like one-week price change and the monthly percentage change in earnings estimates.
VGM ScoreWhat if you like to use all three types of investing? The VGM Score is a combination of all Style Scores, making it one of the most comprehensive indicators to use with the Zacks Rank. It rates each stock on their combined weighted styles, which helps narrow down the companies with the most attractive value, best growth forecast, and most promising momentum.
How Style Scores Work with the Zacks Rank The Zacks Rank is a proprietary stock-rating model that harnesses the power of earnings estimate revisions, or changes to a company's earnings expectations, to help investors build a successful portfolio.
#1 (Strong Buy) stocks have produced an unmatched +23.94% average annual return since 1988, which is more than double the S&P 500's performance over the same time frame. However, the Zacks Rank examines a ton of stocks, and there can be more than 200 companies with a Strong Buy rank, and another 600 with a #2 (Buy) rank, on any given day.
But it can feel overwhelming to pick the right stocks for you and your investing goals with over 800 top-rated stocks to choose from.
That's where the Style Scores come in.
You want to make sure you're buying stocks with the highest likelihood of success, and to do that, you'll need to pick stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B. If you like a stock that only has a #3 (Hold) rank, it should also have Scores of A or B to guarantee as much upside potential as possible.
The direction of a stock's earnings estimate revisions should always be a key factor when choosing which stocks to buy, since the Scores were created to work together with the Zacks Rank.
For instance, a stock with a #4 (Sell) or #5 (Strong Sell) rating, even one that boasts Scores of A and B, still has a downward-trending earnings forecast, and a much greater likelihood its share price will decline as well.
Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.
Stock to Watch: CarMax (KMX - Free Report) CarMax, Inc. is the largest retailer of used vehicles in the United States. In fiscal 2026 (ended Feb. 28, 2026), the company sold approximately 781,000 used vehicles at retail. It is also one of the nation’s largest operators of wholesale vehicle auctions, with roughly 538,000 vehicles sold in fiscal 2026.
KMX is a #2 (Buy) on the Zacks Rank, with a VGM Score of B.
It also boasts a Value Style Score of A thanks to attractive valuation metrics like a forward P/E ratio of 21.26; value investors should take notice.
Eight analysts revised their earnings estimate upwards in the last 60 days for fiscal 2027. The Zacks Consensus Estimate has increased $0.31 to $2.70 per share. KMX boasts an average earnings surprise of +28.9%.
With a solid Zacks Rank and top-tier Value and VGM Style Scores, KMX should be on investors' short list.
A month has gone by since the last earnings report for CarMax (KMX - Free Report) . Shares have added about 9% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is CarMax due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the latest earnings report in order to get a better handle on the important drivers.
CarMax Q1 Earnings Beat EstimatesCarMax reported earnings per share of $1.31 for the first quarter of fiscal 2027, beating the Zacks Consensus Estimate of 94 cents by 39.61%. The bottom line declined 5.1% from $1.38 in the year-ago quarter.
Quarterly revenues rose 6.2% year over year to $8.01 billion, surpassing the consensus mark of $7.6 billion by 5.43%. Results benefited from higher retail and wholesale revenues, while combined retail and wholesale unit sales rose 3.3% to 392,357.
Sales Rise on Higher Vehicle PricingFor the quarter ended May 31, 2026, CarMax’s total net sales and operating revenues were $8.01 billion, up from $7.55 billion a year ago. Used vehicle sales increased 4.7% to $6.39 billion, reflecting a higher average retail selling price.
Total retail used vehicle unit sales were nearly flat at 230,293 versus 230,210 in the prior-year quarter. Comparable-store used-unit sales declined 0.8%, as the company lapped a year-ago quarter that benefited from tariff-driven demand.
Wholesale Momentum Supports the Top LineWholesale vehicle sales rose 14% year over year to $1.43 billion. Wholesale unit sales increased 8.4% to 162,064, while the average wholesale selling price climbed 5.1% to $8,364.
The wholesale business helped offset pressure on retail profitability. Wholesale vehicle gross profit increased 8.3% to $169.5 million, with gross profit per wholesale unit of $1,046, essentially in line with $1,047 in the prior-year quarter.
Margins Face Pricing PressureTotal gross profit declined 4.4% year over year to $854.4 million. Retail used vehicle gross profit fell 9.5% to $501.4 million, hurt by lower per-unit profitability.
Retail gross profit per used unit was $2,177, down $230 from last year’s all-time record due to the continuation of pricing actions aimed at driving an improved sales trend.
Cost Cuts Drive SG&A LeverageSelling, general and administrative expenses decreased 3.7% year over year to $635.2 million. The decline was primarily driven by lower compensation and benefits costs as the company made progress on targeted SG&A reductions.
SG&A per total unit improved 6.8% to $1,619, down $118 from the year-ago quarter. CarMax remains on track to achieve $200 million in SG&A exit-rate savings by the end of fiscal 2027.
Finance Arm Expands PenetrationCarMax Auto Finance’s income was $140.2 million, down 1% from the year-ago quarter. The decline reflected lower auto loans outstanding following last year’s $900 million non-prime securitization, partly offset by interest earned on higher-margin receivables and servicing income.
CAF financed 43.3% of units sold after the impact of three-day payoffs, up 150 basis points year over year. The total interest margin percentage improved 20 basis points to 6.7%, while the weighted average contract rate was 11.3%, broadly in line with the prior-year quarter.
Focus on Growth PillarsCEO Keith Barr introduced a four-pillar strategic framework focused on improving CarMax’s offering, simplifying the customer experience, adding value on each transaction and running lean. The company plans to share more details at a strategic update in late fall.
Pricing competitiveness, saleable inventory, digital-to-store conversion, CAF growth, EPP margin expansion, reconditioning efficiency and logistics improvements are key areas of focus for the company. The goal is to drive unit growth and earnings growth while supporting shareholder returns over time.
Balance Sheet Remains in FocusCarMax ended the quarter with cash and cash equivalents of $132.2 million and inventory of $4.06 billion. Long-term debt excluding the current portion was $2.06 billion, while the current portion of long-term debt was $17.2 million.
The company did not repurchase shares during the first quarter. It had $1.31 billion remaining under its share repurchase authorization as of May 31, 2026, and intends to resume buybacks at an appropriate time depending on market conditions, leverage and capital needs.
How Have Estimates Been Moving Since Then?Since the earnings release, investors have witnessed a upward trend in estimates revision.
VGM ScoresCurrently, CarMax has a average Growth Score of C, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a score of A on the value side, putting it in the top 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
OutlookEstimates have been broadly trending upward for the stock, and the magnitude of these revisions indicates a downward shift. It comes with little surprise CarMax has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
NEW YORK, July 16, 2026 (GLOBE NEWSWIRE) -- Bernstein Liebhard LLP:
Do you currently own shares of CarMax, Inc. (NYSE: KMX)?Did you purchase any of your shares prior to June 20, 2025?Do you want to discuss your rights?
Bernstein Liebhard LLP, a nationally acclaimed investor rights law firm, is investigating whether certain directors and officers of CarMax, Inc. (“CarMax” or the “Company”) (NYSE: KMX) breached the fiduciary duties they owe to the Company.
What To Do Next:
If you currently hold CarMax stock and would like to discuss your legal rights and options, please visit CarMax, Inc. Shareholder Investigation or contact Investor Relations Manager Peter Allocco at (212) 951-2030 or [email protected].
About Bernstein Liebhard:
Since 1993, Bernstein Liebhard LLP has recovered over $3.5 billion for its clients. In addition to representing individual investors, the firm has been retained by some of the largest public and private pension funds in the country to monitor their assets and pursue litigation on their behalf. As a result of its success litigating hundreds of lawsuits and class actions, the firm has been named to The National Law Journal’s “Plaintiffs’ Hot List” thirteen times and listed in The Legal 500 for sixteen consecutive years.
NEW YORK, July 09, 2026 (GLOBE NEWSWIRE) -- Bernstein Liebhard LLP:
Do you currently own shares of CarMax, Inc. (NYSE: KMX)?Did you purchase any of your shares prior to June 20, 2025?Do you want to discuss your rights?
Bernstein Liebhard LLP, a nationally acclaimed investor rights law firm, is investigating whether certain directors and officers of CarMax, Inc. (“CarMax” or the “Company”) (NYSE: KMX) breached the fiduciary duties they owe to the Company.
What To Do Next:
If you currently hold CarMax stock and would like to discuss your legal rights and options, please visit CarMax, Inc. Shareholder Investigation or contact Investor Relations Manager Peter Allocco at (212) 951-2030 or [email protected].
About Bernstein Liebhard:
Since 1993, Bernstein Liebhard LLP has recovered over $3.5 billion for its clients. In addition to representing individual investors, the firm has been retained by some of the largest public and private pension funds in the country to monitor their assets and pursue litigation on their behalf. As a result of its success litigating hundreds of lawsuits and class actions, the firm has been named to The National Law Journal’s “Plaintiffs’ Hot List” thirteen times and listed in The Legal 500 for sixteen consecutive years.
CarMax's (KMX 1.41%) summer started off well, with impressive stock performance despite a quarterly earnings report that, at least initially, wasn't well received. After analysts piled in with a clutch of price target raises and even a recommendation upgrade, the vehicle retailer's stock started heading north again. A series of insider buys also lifted confidence in the stock, and it exited June up by almost 19%.
Stop and start That earnings release was published on June 17, and, at least outwardly, CarMax did well against expectations. Net revenue was just over $8 billion in its first quarter of fiscal 2027, for a year-over-year gain of 6%. Net income under generally accepted accounting principles (GAAP) fell by 12%, however, to $186 million, or $1.31 per share.
Image source: Getty Images.
Despite the bottom-line decline, both metrics handily beat the consensus analyst estimates. On average, pundits tracking the auto retailer's stock were modeling revenue of less than $7.4 billion and GAAP net income of only $0.96 per share.
CarMax was a victim of timing, to an extent. As encouraging as some of the retailer's metrics were, they came at a time of persistently high gasoline prices, driven mostly by this country's conflict with Iran. Most of the models sold by the company are gas-consuming internal combustion engine (ICE) ones.
Also in mid-June, speculation grew that the U.S. Federal Reserve would raise interest rates; if that occurs, auto loans will become more expensive and will likely negatively affect the car market (and, more directly, squeeze the company's proprietary lending arm, CarMax Auto Finance).
Yet the reactions of analysts tracking CarMax stock were in stark contrast to those of investors selling their shares after the quarterly results were published. A clutch of them raised their price targets on CarMax, with one, Jeff Lick of Stephens, going so far as to upshift his recommendation on the stock. For him, it's now an overweight (read: buy), one notch up from his previous equalweight (hold). He also substantially raised his price target to $66 per share from the preceding $43.
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The inside scoop The bullishness in the stock stemming from those analyst moves was exacerbated by a series of insider stock purchases. The most notable buyer was CEO Keith Barr, who purchased 9,400 CarMax shares on June 22. Four members of the company's board of directors also opened their wallets for this purchase, collectively snapping up 14,674 shares.
I feel the immediate sell-off was unjustified; even if profitability declined, that sales growth figure was encouraging, and management seems to be implementing its new "four pillar" business strategy well. The only major concern I would have is gas prices; if they stay lofty, I'd worry that the mega-dealership could take some hits.
RICHMOND, Va., June 30, 2026 (GLOBE NEWSWIRE) -- CarMax, Inc. (NYSE: KMX), the nation’s largest retailer of used cars, has been recognized by Points of Light as a 2026 honoree of The Civic 50®, recognizing the top community-minded companies in the United States according to a comprehensive annual survey. The Civic 50 honorees are recognized for their excellence in employee volunteering, community investment and social impact strategy.
Helping its communities thrive and making a positive social impact is core to who CarMax is and how the company conducts business. Associates are at the core of CarMax’s giving, dedicating their time and talents to meaningful causes important to them. Regional Giving Committees connect store leaders and champions around local priorities, while volunteer programs are built around associates’ passions and interests. Opportunities range from large-scale community projects and companywide walks to small acts of kindness in associates' own neighborhoods. In fiscal year 2026, 100% of CarMax locations participated in volunteer programs, and more than 75% of associates participated in one or more community programs.
"We're honored to be named to the CIVIC 50 by Points of Light, one of the most respected benchmarks for corporate citizenship,” said Leslie Parpart, assistant vice president of CSR and Associate Experience, CarMax. "This recognition reflects the heart of who we are, associates who show up for their communities with care, intention, and a genuine commitment to making a difference. We're incredibly proud to be recognized alongside so many community-minded companies, and especially proud of the associates who bring this to life every day."
Now in its 14th year, The Civic 50® is the nation’s leading corporate social impact recognition program, celebrating excellence in employee volunteering, community investment and social impact strategy. The Civic 50® survey, which recognizes public and private companies with annual revenues of at least $1 billion, allows CSR teams to track purposeful volunteering, giving and community engagement insights.
“Today’s leading companies understand that community engagement is more than a program, it’s a reflection of their commitment to advancing social impact in ways that strengthen both their company and the communities they serve,” said Jennifer Sirangelo, president and CEO of Points of Light. “CarMax demonstrates how to embed purpose into the employee experience, build authentic relationships with communities and use business as a force for good. We’re proud to honor them with the 2026 Civic 50 award.”
The survey includes quantitative and multiple-choice questions that inform the scoring process. The Civic 50® remains the only survey and ranking system focused exclusively on measuring corporate community engagement.
About CarMax
CarMax, the nation’s largest retailer of used autos, revolutionized the automotive retail industry by driving integrity, honesty and transparency in every interaction. The company offers a truly personalized experience with the option for customers to do as much, or as little, online and in-store as they want. During the fiscal year that ended February 28, 2026, CarMax sold approximately 780,000 used vehicles and 540,000 wholesale vehicles at its auctions. In addition, CarMax Auto Finance originated $8 billion in auto loans during fiscal 2026, adding to its $16 billion portfolio. CarMax has more than 255 store locations, approximately 28,000 associates, and is proud to have been recognized for 22 consecutive years as one of the Fortune 100 Best Companies to Work For®. CarMax is committed to helping its communities thrive and reducing the environmental footprint of its operations. Learn more in the 2026 Responsibility Report. For more information, visit www.carmax.com.
About Points of Light
Points of Light is a nonpartisan, global nonprofit organization that inspires, equips and mobilizes millions of people to create positive change through volunteering and civic engagement. Through work with nonprofits, companies and social impact leaders, the organization galvanizes volunteers to meet critical needs in communities. As the world’s largest organization dedicated to increasing volunteer service, Points of Light engages more than 3.8 million volunteers across 32 countries. For more information, visit www.pointsoflight.org.
Taking full advantage of the stock market and investing with confidence are common goals for new and old investors, and Zacks Premium offers many different ways to do both.
The research service features daily updates of the Zacks Rank and Zacks Industry Rank, full access to the Zacks #1 Rank List, Equity Research reports, and Premium stock screens, all of which will help you become a smarter, more confident investor.
Zacks Premium also includes the Zacks Style Scores.
What are the Zacks Style Scores? The Zacks Style Scores, developed alongside the Zacks Rank, are complementary indicators that rate stocks based on three widely-followed investing methodologies; they also help investors pick stocks with the best chances of beating the market over the next 30 days.
Each stock is assigned a rating of A, B, C, D, or F based on their value, growth, and momentum characteristics. Just like in school, an A is better than a B, a B is better than a C, and so on -- that means the better the score, the better chance the stock will outperform.
The Style Scores are broken down into four categories:
Value ScoreFor value investors, it's all about finding good stocks at good prices, and discovering which companies are trading under their true value before the broader market catches on. The Value Style Score utilizes ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and a host of other multiples to help pick out the most attractive and discounted stocks.
Growth ScoreWhile good value is important, growth investors are more focused on a company's financial strength and health, and its future outlook. The Growth Style Score takes projected and historic earnings, sales, and cash flow into account to uncover stocks that will see long-term, sustainable growth.
Momentum ScoreMomentum traders and investors live by the saying "the trend is your friend." This investing style is all about taking advantage of upward or downward trends in a stock's price or earnings outlook. Employing factors like one-week price change and the monthly percentage change in earnings estimates, the Momentum Style Score can indicate favorable times to build a position in high-momentum stocks.
VGM ScoreIf you like to use all three kinds of investing, then the VGM Score is for you. It's a combination of all Style Scores, and is an important indicator to use with the Zacks Rank. The VGM Score rates each stock on their shared weighted styles, narrowing down the companies with the most attractive value, best growth forecast, and most promising momentum.
How Style Scores Work with the Zacks Rank A proprietary stock-rating model, the Zacks Rank utilizes the power of earnings estimate revisions, or changes to a company's earnings outlook, to help investors create a successful portfolio.
#1 (Strong Buy) stocks have produced an unmatched +23.94% average annual return since 1988, which is more than double the S&P 500's performance over the same time frame. However, the Zacks Rank examines a ton of stocks, and there can be more than 200 companies with a Strong Buy rank, and another 600 with a #2 (Buy) rank, on any given day.
With more than 800 top-rated stocks to choose from, it can certainly feel overwhelming to pick the ones that are right for you and your investing journey.
That's where the Style Scores come in.
To maximize your returns, you want to buy stocks with the highest probability of success. This means picking stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B. If you find yourself looking at stocks with a #3 (Hold) rank, make sure they have Scores of A or B as well to ensure as much upside potential as possible.
Since the Scores were created to work together with the Zacks Rank, the direction of a stock's earnings estimate revisions should be a key factor when choosing which stocks to buy.
A stock with a #4 (Sell) or #5 (Strong Sell) rating, for instance, even one with Scores of A and B, will still have a declining earnings forecast, and a greater chance its share price will fall too.
Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.
Stock to Watch: CarMax (KMX - Free Report) CarMax, Inc. is the largest retailer of used vehicles in the United States. In fiscal 2026 (ended Feb. 28, 2026), the company sold approximately 781,000 used vehicles at retail. It is also one of the nation’s largest operators of wholesale vehicle auctions, with roughly 538,000 vehicles sold in fiscal 2026.
KMX is a #3 (Hold) on the Zacks Rank, with a VGM Score of A.
It also boasts a Value Style Score of B thanks to attractive valuation metrics like a forward P/E ratio of 20.09; value investors should take notice.
Six analysts revised their earnings estimate higher in the last 60 days for fiscal 2027, while the Zacks Consensus Estimate has increased $0.22 to $2.65 per share. KMX also boasts an average earnings surprise of +28.9%.
With a solid Zacks Rank and top-tier Value and VGM Style Scores, KMX should be on investors' short list.
On June 25, 2026, CarMax Inc (KMX) shares rose 4.2% to $52.90. The stock has experienced a 52-week range of $30.26 to $71.99, reflecting significant volatility
Taking full advantage of the stock market and investing with confidence are common goals for new and old investors, and Zacks Premium offers many different ways to do both.
Featuring daily updates of the Zacks Rank and Zacks Industry Rank, full access to the Zacks #1 Rank List, Equity Research reports, and Premium stock screens, the research service can help you become a smarter, more self-assured investor.
It also includes access to the Zacks Style Scores.
What are the Zacks Style Scores? The Zacks Style Scores, developed alongside the Zacks Rank, are complementary indicators that rate stocks based on three widely-followed investing methodologies; they also help investors pick stocks with the best chances of beating the market over the next 30 days.
Based on their value, growth, and momentum characteristics, each stock is assigned a rating of A, B, C, D, or F. The better the score, the better chance the stock will outperform; an A is better than a B, a B is better than a C, and so on.
The Style Scores are broken down into four categories:
Value ScoreValue investors love finding good stocks at good prices, especially before the broader market catches on to a stock's true value. Utilizing ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and many other multiples, the Value Style Score identifies the most attractive and most discounted stocks.
Growth ScoreWhile good value is important, growth investors are more focused on a company's financial strength and health, and its future outlook. The Growth Style Score takes projected and historic earnings, sales, and cash flow into account to uncover stocks that will see long-term, sustainable growth.
Momentum ScoreMomentum traders and investors live by the saying "the trend is your friend." This investing style is all about taking advantage of upward or downward trends in a stock's price or earnings outlook. Employing factors like one-week price change and the monthly percentage change in earnings estimates, the Momentum Style Score can indicate favorable times to build a position in high-momentum stocks.
VGM ScoreWhat if you like to use all three types of investing? The VGM Score is a combination of all Style Scores, making it one of the most comprehensive indicators to use with the Zacks Rank. It rates each stock on their combined weighted styles, which helps narrow down the companies with the most attractive value, best growth forecast, and most promising momentum.
How Style Scores Work with the Zacks Rank The Zacks Rank, which is a proprietary stock-rating model, employs earnings estimate revisions, or changes to a company's earnings expectations, to make building a winning portfolio easier.
#1 (Strong Buy) stocks have produced an unmatched +24% average annual return since 1988, which is more than double the S&P 500's performance over the same time frame. However, the Zacks Rank examines a ton of stocks, and there can be more than 200 companies with a Strong Buy rank, and another 600 with a #2 (Buy) rank, on any given day.
With more than 800 top-rated stocks to choose from, it can certainly feel overwhelming to pick the ones that are right for you and your investing journey.
That's where the Style Scores come in.
You want to make sure you're buying stocks with the highest likelihood of success, and to do that, you'll need to pick stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B. If you like a stock that only has a #3 (Hold) rank, it should also have Scores of A or B to guarantee as much upside potential as possible.
The direction of a stock's earnings estimate revisions should always be a key factor when choosing which stocks to buy, since the Scores were created to work together with the Zacks Rank.
For instance, a stock with a #4 (Sell) or #5 (Strong Sell) rating, even one that boasts Scores of A and B, still has a downward-trending earnings forecast, and a much greater likelihood its share price will decline as well.
Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.
Stock to Watch: CarMax (KMX - Free Report) CarMax, Inc. is the largest retailer of used vehicles in the United States. In fiscal 2026 (ended Feb. 28, 2026), the company sold approximately 781,000 used vehicles at retail. It is also one of the nation’s largest operators of wholesale vehicle auctions, with roughly 538,000 vehicles sold in fiscal 2026.
KMX is a #3 (Hold) on the Zacks Rank, with a VGM Score of A.
Momentum investors should take note of this Retail-Wholesale stock. KMX has a Momentum Style Score of A, and shares are up 20.2% over the past four weeks.
Six analysts revised their earnings estimate upwards in the last 60 days for fiscal 2027. The Zacks Consensus Estimate has increased $0.17 to $2.60 per share. KMX boasts an average earnings surprise of +28.9%.
With a solid Zacks Rank and top-tier Momentum and VGM Style Scores, KMX should be on investors' short list.
CarMax NYSE: KMX entered a market reversal earlier this year asc it transitioned to a new CEO and activist investors took positions. The story now is that Keith Barr’s four-pillar strategy to increase volume, improve digital sales, add value on each transaction, and drive efficiency is gaining traction.
The question is whether CarMax can preserve its cost savings and return to profitable growth in the coming quarters, and the early signs are encouraging. In this environment, CarMax remains in the middle of an evolving catalyst, with the stronger signal—sustained operational improvement—still to come.
Get CarMax alerts:
CarMax Outperforms in Q1, First Report With New CeoCarMax Today
$52.31 +0.40 (+0.77%)
As of 11:40 AM Eastern
This is a fair market value price provided by Massive. Learn more.
52-Week Range$30.26▼
$71.99P/E Ratio34.26
Price Target$47.73
CarMax faced headwinds in Q1 fiscal year 2027 (FY2027), including uneven consumer demand and affordability pressure, but performed well, with unit volume increasing by 3.3% across the system.
Revenue grew by 6% to just over $8 billion, outperforming expectations by more than 780 basis points. Segmentally, wholesalers did the heavy lifting, with units up 8% compared to a basically flat retail side.
Lower relative pricing aided the strength and is reflected in the margin. The company managed to reduce selling, general, and administrative (SG&A) expenses and improve efficiency on a per-unit basis, but gross margin impairment offset these gains. The takeaway is that gross profit declined by nearly 5%, net margin contracted by approximately 50 basis points despite an improvement in SG&A, and GAAP earnings declined.
The offset is that earnings per share (EPS) of $1.31 outpaced consensus by a wide 34-cent margin, providing sufficient cash flow to sustain operations and maintain balance sheet quality. CarMax's balance sheet carries debt, but it did not provide any red flags for investors.
The company does not provide specific guidance on operational metrics, but it did offer color on what to expect this year. As it stands, the focus is on improving sales and customer satisfaction, which will put pressure on margins. That trade-off is important for investors to watch. Lower asking prices can help rebuild unit volume, while continued investment in digital services may weigh on profitability until those efficiencies scale.
Among the critical Q1 takeaways, however, are the 84% of retail unit sales supported by digital capabilities and 14% online retail sales, with digital channels central to reducing time-to-close, improving customer outcomes, and supporting longer-term operating efficiency.
Current Price$52.60High Forecast$66.00Average Forecast$47.73Low Forecast$35.00CarMax Stock Forecast Details
Analyst sentiment is central to CarMax’s 2025 stock price decline and 2026 rebound.
After price target cuts and weaker coverage weighed on KMX in 2025, the tone in 2026 has shifted toward cautious optimism as investors evaluate the CEO transition and early signs of operational improvement.
Analyst activity since February 2026 has included initiations, reaffirmed targets, and, more recently, price target increases that have helped stabilize the consensus estimate.
The consensus price target is around $42, below the current share price but aligning with the technical price floor put in place last year, and is likely to advance amid operational improvements and strengthen the expected catalyst.
Institutional trends look more bullish despite mixed activity over the trailing 12-month period. Selling outweighed buying in parts of 2025, but activity in the first half of 2026 suggests renewed accumulation. More importantly, the periods of accumulation and distribution align with CarMax’s price action, revealing group buying on dips and market support at the lower end of its trading range.
The likely outcome is that KMX's downside is limited, and institutional support will strengthen and advance in subsequent quarters.
CarMax Catalysts: There Is More Than One Coming Down the PipeCarMax has several catalysts coming down the pike, centered on its upcoming earnings reports. The reports are expected to show improvements, including cash flow and future profitability. Among the catalysts is the capacity for capital return, which centers on share buybacks.
CarMax paused share repurchases in the latest quarter, but prior buybacks have still reduced the company’s share count over the past year. A resumption of repurchases could become a bullish catalyst if earnings stabilize. Management is also expected to provide more details on its turnaround strategy later this year.
Chart price action is not bullish following the release. The market for KMX stock is down more than 5% and may continue to decline in the near term. The caveat is that this market appears in the midst of a Double-Bottom Reversal, and the mid-June pullback is testing critical support.
Assuming support holds, KMX shares could advance this summer, potentially reaching $70 by early Fall. If not, a move to retest recent lows near $37.50 is probable—lower lows are not expected to come this year.
Should You Invest $1,000 in CarMax Right Now?Before you consider CarMax, you'll want to hear this.
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CarMax Inc (NYSE:KMX) shares fell more than 6% in early trade on Wednesday as investors looked past a better-than-expected first quarter earnings report and focused on margin pressure, credit risks and concerns about the company's profitability strategy.
The used-vehicle retailer reported adjusted earnings per share of $1.31 for the quarter, well above analyst estimates of $0.95.
Revenue increased 6.2% year over year to $8.01 billion, topping consensus expectations of about $7.4 billion.
Combined retail and wholesale vehicle sales rose 3.3% to 392,357 units. Wholesale unit sales increased 8.4%, while retail used-vehicle sales were up slightly. Comparable-store used-vehicle sales declined 0.8%.
Investors, however, focused on declining retail vehicle profitability. Gross profit per retail used vehicle fell $230 year over year to $2,177 as CarMax continued pricing actions aimed at supporting sales growth. The company has now experienced several consecutive quarters of margin compression as it prioritizes volume.
Concerns also centered on credit quality within CarMax Auto Finance (CAF). While CAF penetration increased to 43.3% from 41.8% a year earlier, investors remain cautious about rising loan delinquency risks and the company's increased exposure to lower-tier borrowers. CAF income declined 1% to $140.2 million during the quarter.
The company purchased approximately 322,000 vehicles from consumers and dealers, down 4.4% from a year earlier.
The report was the first under new CarMax CEO Keith Barr, who said in a statement that the company has adopted a four-pillar strategic framework aimed at driving unit sales and earnings growth while improving shareholder returns.
“We are entering this fiscal year with a clear strategy that is driving early results,” he said. “Our goal is clear: deliver strong unit sales and earnings growth that enables us to consistently reward our shareholders.”
CarMax KMX is experiencing a decline in stock price despite surpassing expectations in its Q1 earnings report. The used-car retailer achieved a significant earnings per share (EPS) beat, its largest in recent quarters, with revenue rising 6.2% year-over-year to $8.01 billion. This marks a return to revenue growth, driven primarily by improved unit sales trends—both retail and wholesale. The positive results are attributed to competitive pricing, enhanced value, and effective early strategies under new CEO Keith Barr, indicating that the company's turnaround is gaining momentum.
Key Metrics: - Used comps decreased by 0.8% year-over-year, showing sequential improvement against a challenging +8.1% comparison from last year. - Combined retail and wholesale unit sales rose 3.3% to 392,357, with wholesale units up 8.4% and retail used units slightly higher year-over-year. Focus Areas: - CEO Keith Barr highlighted areas needing improvement, including core operations efficiency, retail pricing and selection, high costs, and a complex digital experience. - The digital-to-store transition is causing friction for customers, limiting KMX's ability to fully utilize its scale. Strategy: - KMX's turnaround strategy focuses on four key pillars: enhancing vehicle offerings, simplifying the customer experience, increasing transaction value, and operating more efficiently. - The plan aims to improve pricing, inventory access, conversion rates, CAF/EPP contributions, and reduce structural costs. Margins: - Competitive pricing pressures margins, although cost reductions are mitigating some earnings impact. - Total gross profit fell 4% year-over-year to $854 million, with gross margin contracting about 110 basis points to 10.7%. - Used retail gross profit per unit (GPU) decreased by $230 year-over-year to $2,177, which was better than management's previous expectation of a $300 decline. CAF/EPP: - CAF penetration rose by 150 basis points to 43.3%, supported by KMX's comprehensive financing initiatives. - The rollout of a redesigned EPP offering is anticipated to add approximately $35 per unit in incremental margin by FY27. KMX's recent Q1 results suggest that CEO Keith Barr is implementing effective strategies for the company's turnaround, although management acknowledges that recovery is still in its early stages. The stock's decline may be attributed to profit-taking after a significant rally leading up to the report, as investors anticipated strong performance. While used comps remain negative, the 0.8% decline reflects a sequential improvement against a tough comparison. The overall improvement in combined retail and wholesale units, along with returning revenue growth, indicates that competitive pricing and enhanced value are beginning to stimulate demand. However, GPU and margins continue to face pressure, raising questions about how long KMX will rely on pricing strategies to boost volume. Encouragingly, GPU pressure was less severe than expected, and cost-saving measures, along with higher CAF penetration and EPP redesign, provide KMX with tools to mitigate earnings impacts. The upcoming quarters will be crucial in determining if the improved unit trends and Barr's broader strategy can lead to consistent earnings growth.
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Shares of CarMax (NYSE:KMX | KMX Price Prediction) stock are down 7% midday Wednesday near $48.30 after the used-car retailer reported fiscal Q1 2027 results before the open. The headline numbers cleared expectations comfortably, but the stock fell anyway.
Carvana (NYSE:CVNA) stock is down 8% to around $64.65 in sympathy, with no company-specific catalyst behind the move. The used-car retail group is treating CarMax’s margin commentary and credit data as a read-through to the entire sector.
The setup is unusual. CarMax delivered both an earnings and a revenue beat, but investors zeroed in on shrinking per-unit profitability and rising loan-loss reserves at CarMax Auto Finance (CAF). The “beat but fell” pattern is amplified because CarMax stock had rallied sharply heading into the report.
CarMax stock has been one of the year’s stronger rebound stories, climbing 35% year to date through Tuesday’s close at $52.11. That run set a high bar going into the release and left less margin for any operational disappointment.
Earnings Beat Masked by Margin and Credit Concerns CarMax reported Q1 FY2027 EPS of $1.31 versus consensus near $0.944, and revenue of $8.01 billion topped the $7.42 billion estimate. Both lines beat by a wide margin.
The quality of earnings cracked under the hood. Retail used vehicle gross profit per unit at CarMax fell $230 year over year to $2,177, reflecting deliberate pricing actions to drive volume. Total gross profit declined and net earnings fell 12% to $185.6 million.
Credit signals also tightened at CarMax. The allowance for loan losses rose to 3% of auto loans held for investment from 3% the prior quarter. CAF income slipped to $140.2 million, even as CAF penetration climbed to 43%, partly reflecting more Tier 2 exposure.
There were operational positives at CarMax. SG&A per total unit improved 7% to $1,619, and wholesale revenues rose 14% on higher wholesale unit volume. However, comparable-store used unit sales declined 1%, hinting at soft underlying demand despite the headline revenue beat.
This was also the first report under new CarMax CEO Keith Barr, three months into the role. Barr stated, “I came to CarMax because I saw a strong foundation, an award-winning, people-first culture, and significant potential to unlock growth.” Notably, Barr introduced a four-pillar framework and reiterated a $200 million SG&A (Selling, General, and Administrative expenses) exit-rate savings target by fiscal year-end 2027.
Carvana Sells Off in Sympathy Carvana has no company-specific news today. The 8% drop in Carvana shares reflects sector read-through from CarMax’s used-vehicle pricing pressure and credit-quality flag. The two stocks often trade together when sector narratives shift.
The selloff hits a stock that has already been choppy. Carvana stock was down 17% year to date heading into today, with a market cap near $45.94 billion. Carvana shares closed at $70.04 on Tuesday before today’s slide.
Carvana’s most recent quarter was strong, with Q4 2025 EPS of $4.22 and revenue of $5.6 billion, up 58% year over year. However, the company carries $4.83 billion in long-term debt, which makes used-auto credit-cycle headlines particularly impactful for Carvana shares. Bullish analyst notes earlier in 2026 have leaned on resilient securitization structures and rising used-car prices as offsets.
What to Watch Next CarMax already held its earnings call this morning at 8:00 a.m. ET, and management has flagged a formal Strategic Update planned for late fall to outline further milestones under Barr’s plan. That event could reshape the bull-bear debate on CarMax shares. The next scheduled earnings release for CarMax is Q2 FY2027 on September 29.
Carvana’s next scheduled catalyst is its Q2 2026 earnings release, expected in late July. Until then, Carvana stock may trade as a high-beta proxy for used-car retail sentiment, magnifying any peer moves on credit or pricing data.
Sector sentiment is the swing factor for both names. Should used-car credit data stabilize in coming weeks, today’s reaction could prove a one-day overshoot at CarMax and Carvana. A continued uptick in subprime auto delinquencies, on the other hand, may keep pressure on the group, particularly given Carvana’s leverage profile.
The takeaway is straightforward: CarMax beat estimates and still fell because investors prioritized per-unit margin compression and rising CAF reserves over the headline number. Investors can watch for whether today’s selloff in both names holds into the close, and whether further sector data points reinforce or ease the concerns flagged in the CarMax report.
Carvana CVNA shares opened in the “red” this morning in sympathy with peer CarMax (KMX) whose Q1 earnings signaled margin compression, stubbornly weak volumes, and rising acquisition costs.
But a compelling case can be made that the market is lazily painting both companies with the same brush, ignoring the fundamental structural differences between how they operate.
Here’s why the sell-off in Carvana stock today is unwarranted and may actually be an opportunity for long-term investors to load up on a quality name at a discount.
The most obvious flaw in the “sympathy sell-off” logic is that Carvana and CarMax are on entirely different growth curves right now.
KMX saw its comparable-store used units slip 0.8% this quarter – continuing a long-running trend of sluggish retail volume.
The company is stuck in a mature, brick-and-mortar bottleneck.
CVNA, on the other hand, is capturing massive market share: In its latest reported quarter, Carvana posted an explosive 40% year-on-year growth in retail units, selling over 187,000 cars.
CarMax explicitly said today that it had to cut prices and sacrifice margin just to “try” and prop up stagnant volumes, but Carvana is pulling in hyper-growth numbers without having to trim its unit economics.
So, a margin squeeze born out of KMX operational stagnation doesn’t automatically mean Carvana is experiencing the same friction – that’s what makes CVNA shares worth buying on the dip.
Investors panicked also because CarMax’s retail gross profit per unit (GPU) tanked by $230 in the first quarter to $2,177.
However, treating this as a death sentence for CVNA ignores how much more vertically integrated and multi-layered its GPU structure really is.
KMX’s profit model is tightly tethered to the traditional spread between wholesale acquisition and retail sticker price.
When wholesale acquisition cost pops (as they did this quarter, driving CarMax’s average selling price up by $1,168), the company’s margins get crushed.
But CVNA’s total GPU isn’t just about the metal. It generates “highly optimized” revenue streams from proprietary digital financing, gap insurance, extended warranties, and a vertically integrated logistics/reconditioning network.
In Q1, the company delivered an industry-leading 10.4% Adjusted EBITDA margin.
So, Carvana shares are attractive because they’re structurally built to absorb fluctuations in vehicle acquisition costs far better than KMX’s legacy model.
CarMax’s new chief executive, Keith Barr, spent much of the earnings call talking about operational inefficiencies, explicitly mentioning that KMX moves roughly 2 million cars annually via transfers but suffers from “too many unproductive transfers.”
Simply put, the company is weighed down by heavy fixed overhead: physical dealerships, massive localized inventory footprints, and regional logistics inefficiencies.
When foot traffic slows down, those fixed costs bleed them quickly. But Carvana’s “digital-first”, centralized hub-and-spoke model allows for much higher variable cost elasticity.
CVNA stock looks compelling as it routes fulfillment dynamically through digital platforms and centralized reconditioning centers; it doesn’t face the same “unproductive localized overhead” that CarMax is currently scrambling to restructure.
CarMax, Inc. delivered a better than expected Q1, though results were boosted by a surprise credit release. Used car margins remain under pressure due to pricing concessions and consumers trading down to cheaper cars, though KMX has stabilized volumes. Financing results were better than expected though its increase in Tier 2 lending will likely drive incremental credit reserves.
CarMax is rated a sell due to unfavorable risk/reward, high valuation multiples, and gross margin pressures. Q1 FY27 results showed revenue growth driven by higher ASPs and wholesale volume, but gross profit per used car declined $230 YoY to $2,177. SG&A cost control and redesigned extended protection plans offer some margin support, but buybacks have paused and customer credit quality is deteriorating.
CarMax revenues are up, and CEO Keith Barr said he is focused on improving the company’s digital car shopping experience.
The used car dealer reported quarterly earnings Wednesday (June 17) that showed net revenues of $8 billion, a 6.2% increase. To continue this trajectory, Barr said during an earnings call that CarMax’s online presence needs to change.
“Our digital experience is too complex and not seamlessly connected to the in-person experience,” he said. “When a customer arrives at one of our stores, we do not make it as easy for them as it should be, given all the steps they have taken online.”
The process has added friction to the customer experience, which has affected conversion and kept CarMax from using its scale and store network, he said.
“We know exactly what needs to change, and we’re moving forward with urgency,” added Barr, who became CarMax’s CEO in March.
Management said during the earnings call that consumer behavior in the automotive sector has pivoted toward a demand for a hybrid experience, combining digital convenience and physical verification. The company said industry research and its own in-house findings bear this out.
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“Buying a car is one of the biggest financial decisions someone makes, and they have a strong desire to see, touch and test drive a vehicle that will be part of their daily lives for years to come,” Barr said.
To address this, management said CarMax is working to remove friction from the buying journey with upgrades like integrating AI assistants into the digital experience.
“We basically improved the entry point for our customers arriving from online ads,” Barr said. “We’ve made it easier to navigate our website to get toward prequalification and reserving a car. We’ve effectively shifted away from sticker prices to monthly payments.”
The company has also streamlined its web navigation to accelerate prequalification and vehicle reservations, making sure that the work a customer does at home translates instantly when they arrive at one of the company’s stores.
“Our stores reach 85% of the U.S. population, which gives us access to the largest total addressable market,” Barr said. “We expect more customers will visit our stores, and we will sell more cars.”
Barr joined CarMax after serving as CEO of InterContinental Hotels Group (IHG). In announcing his appointment earlier this year, CarMax said Barr modernized IHG’s technology, in part by developing a digital reservation system that improved the booking experience and let guests personalize their stays.
Shares of CarMax fell 9% Wednesday after the company beat Wall Street's quarterly earnings expectations and its new CEO detailed a high-level turnaround strategy for the company.
Here's how the company performed in its first fiscal quarter, compared with average estimates compiled by LSEG:
Earnings per share: $1.31 vs. 95 cents expected Revenue: $8.01 billion vs. $7.42 billion expectedDespite the beats, questions remain about the company's ability to grow and cut costs under the plan as it faces tougher market conditions. The used-vehicle retailer reported margin pressure and declining gross profit per retail used vehicle.
CarMax's total gross profit was $854.4 million, down 4.4% compared with last year's first fiscal quarter. Retail used vehicle gross profit decreased 9.5% and retail gross profit per used unit was $2,177, down $230 from last year's all-time record, the company said. Its net revenue was up 6.2% compared with nearly $7.6 billion a year earlier.
CarMax reported net earnings of $185.6 million, down 11.8% from $210.4 million in the same period last year.
Shares of CarMax are still up roughly 25% this year, including a roughly 16% increase since Keith Barr, a former CEO of InterContinental Hotels Group, began leading the company on March 16.
Barr said he will release more details of his plan — which is expected to take multiple years to execute — in late fall, but he noted that leadership is "super confident about it."
"Our new strategy is focused on great offerings, easy experience, adding value, running lean, all of which, again, will drive sustainable long-term growth, which will create value for our shareholders," he told CNBC during an interview.
CarMax and Carvana shares in 2026.
Barr said he has spent his first three months at CarMax better learning the car business, understanding the company's operations and determining potential growth and cost-cutting areas, while aiming to streamline the car-buying processes for customers.
"There's definitely significant opportunity for growth here by having a really integrated, growth-oriented strategy that leverages technology, that leverages our scale, that leverages our stores, that will provide sustainable growth, too," he said.
His initial quick changes have included making tweaks to CarMax's website, such as showing monthly payments; implementing an artificial intelligence call agent service; and trying to better streamline a customer's experience from online to in-store.
Barr was brought in following massive share declines that led to pressure for former CEO Bill Nash to step down in November.
Shares of CarMax's largest competitor, Carvana, also were more than 7% lower during midday trading Wednesday, which coincided with the online vehicle retailer disclosing plans for its new franchised Stellantis stores. Carvana's plan includes using the franchise stores to service vehicles and offer test drives, but it will still exclusively sell its vehicles online, even if customers are at the stores.
Barr declined to comment on Carvana's plans, but said CarMax has found the vast majority of its used-vehicle customers still like to visit stores and see the vehicle they're planning to purchase before doing so.
Carvana shares are sliding. Why is CVNA stock dropping? CarMax Beats Estimates But Margins SlideGross profit fell 4.4% to $854.4 million. Profit tied to retail units dropped 9.5%. Gross profit per retail used unit declined $230 from the prior year to $2,177. CarMax said the decline reflected pricing decisions aimed at supporting stronger sales momentum.
Margin Pressure Expected To ContinueDespite the earnings beat, CarMax warned that pressure on vehicle margins will likely persist as it prioritizes sales growth over margin preservation. Management reiterated that it expects lower gross profit per retail unit for the fiscal year and will continue adjusting prices to stay competitive.
The margin commentary from CarMax, a major peer in the used‑vehicle retail space, appears to be weighing on sentiment toward Carvana as well.
Critical Levels To Watch For Carvana StockMomentum is best evaluated through RSI. The indicator sits at 52.19, which is a neutral reading and consistent with a stock that is moving sideways rather than establishing a new direction. RSI measures how stretched buying or selling pressure has become. This level suggests the decline has not reached oversold conditions even as price tests lower areas.
Key Resistance: $73.00 This level sits near a round number and aligns with the longer moving average zone, including the 200‑day average at $73.61, which can cause rebounds to stall. Key Support: $61.00 — This is a nearby floor just above recent lows where buyers may attempt to stabilize the current downswing. CVNA Shares Are TumblingCVNA Price Action: Carvana shares were down 7.27% at $64.96 at the time of publication on Wednesday. The stock is trading near its 52-week low of $54.46, according to Benzinga Pro.
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Marley Kayden discusses financials leading the market higher while investors digested the Federal Reserve's decision to keep interest rates unchanged. Meanwhile, CarMax (KMX) slid after earnings and Netflix (NFLX) denied reports of interest in acquiring Lionsgate.
CarMax (KMX +13.13%) stock lost ground in Wednesday's trading even though the company recently reported better-than-expected quarterly results. The company's share price fell roughly 9% in a daily session that saw the S&P 500 fall approximately 1.2%, and the Nasdaq Composite decline roughly 1.3%.
Before the market opened this morning, CarMax published results for the first quarter of its 2027 fiscal year -- a period that ended May 31. The company actually posted sales and earnings for fiscal Q1 that beat the market's expectations, but forward guidance wound up coming in below the market's targets.
Image source: Getty Images.
CarMax stock sank despite quarterly beats CarMax recorded earnings per share of $1.31 on revenue of $8.01 billion. The company's per-share profit topped the average analyst estimate by $0.37, and revenue came in roughly $580 million higher than the average target.
CarMax's sales rose roughly 6.1% year over year in fiscal Q1, and combined retail and wholesale unit sales were up 3.3% compared to the prior-year period. On the other hand, earnings per share actually declined 5.1% year over year compared to the profit of $1.38 per share recorded by the business in the prior-year period.
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What's next for CarMax? With its fiscal Q1 report, CarMax stated that it was seeing some pressure on selling, general, and administrative expenses -- but management also said that it expected to reach its target for roughly $200 million in category savings in the fiscal year. The company also said that it was on track for roughly $35 per unit in incremental extended protection plans (EPP) in the fiscal year and that it expected its national EPP redesign rollout to be completed in the current quarter. CarMax's fiscal Q1 results actually looked quite solid, but some investors were apparently looking for stronger forward guidance.
Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends CarMax. The Motley Fool has a disclosure policy.
CarMax is rated Buy following a post-earnings dip, with Street estimates appearing overly pessimistic given easier upcoming comps. KMX's new four-pillar strategy targets competitive pricing, digital experience, profitability expansion, and cost efficiency, aiming to stabilize gross profit per unit. I project $3.27 in EPS and $27.8B revenue for FY27, materially above consensus, supporting a $59 price target and 24% upside.
The CNN Money Fear and Greed index showed a decline in the overall market sentiment, while the index remained in the “Fear” zone on Wednesday.
U.S. stocks settled lower on Wednesday, with the Dow Jones index falling more than 500 points during the session after the Federal Reserve announced its policy decision.
The Federal Reserve unanimously held the federal funds rate steady at 3.50%-3.75% on Wednesday, as widely expected, in the first policy meeting under new Fed Chair Kevin Warsh.
The Fed’s closely watched dot plot showed that several officials now expect interest rates to rise in 2026. The Fed penciled in higher inflation, a lower unemployment rate and one hike this year, marking a hawkish shift from the March dot plot, which had signaled one additional rate cut.
On the economic data front, U.S. retail sales rose 0.9% month-over-month in May, following a revised 0.4% gain in April and topping market estimates of 0.5%. U.S. pending home sales jumped 3.8% month-over-month in May, compared to a revised 0.3% gain in the previous month and topping market estimates of 0.8%.
CarMax Inc. (NYSE:KMX) reported better-than-expected earnings for the first quarter on Wednesday.
All sectors on the S&P 500 closed on a negative note, with communication services, consumer discretionary and real estate stocks recording the biggest losses on Wednesday.
The Dow Jones closed lower by around 507 points to 51,492.55 on Wednesday. The S&P 500 fell 1.21% to 7,420.10, while the Nasdaq Composite dipped 1.34% at 26,021.66 during Wednesday's session.
What Is CNN Business Fear & Greed Index?At a current reading of 32.7, the index remained in the “Fear” zone on Wednesday, versus a prior reading of 39.1.
The Fear & Greed Index is a measure of the current market sentiment. It is based on the premise that higher fear exerts pressure on stock prices, while higher greed has the opposite effect. The index is calculated based on seven equal-weighted indicators. The index ranges from 0 to 100, where 0 represents maximum fear and 100 signals maximum greediness.
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Key Takeaways CarMax framed Q1 around a four-pillar plan focused on offering, experience, value and lean operations.KMX beat earnings and revenue estimates, while net sales rose 6.2% and total unit sales climbed 3.3%.CarMax is using cost savings, dynamic pricing, finance growth and EPP gains to improve transaction economics. CarMax, Inc. (KMX - Free Report) used its first-quarter fiscal 2027 earnings call to shift the focus from a simple quarterly beat to a broader operating reset. Management argued the business has already begun to show better sales and earnings trends, but also acknowledged clear execution gaps.
The central message was that CarMax is moving faster on pricing, digital simplification, cost control and finance penetration, with a deeper strategic update planned for the fall.
CarMax Reframes Growth Around Four PillarsPresident and CEO Keith Barr said CarMax’s strategy now rests on four pillars: great offering, easy experience, add value on each transaction and run lean. He described the framework as a practical operating agenda rather than a long-range aspiration.
Barr said the company’s main weaknesses are not hard to identify. He pointed to slower core operations, pricing and selection that still need improvement, a digital journey that remains too complex and a store experience that is not yet tightly connected to online steps.
That framing mattered more than the headline beat. The company reported earnings per share of $1.31, which beat the Zacks Consensus Estimate of 94 cents, delivering a surprise of 39.4%. KMX’s quarterly revenues of $8.01 billion also surpassed the Zacks Consensus Estimate of $7.60 billion by 5.4%.
KMX Trades Margin for Sales MomentumCarMax reported net sales and operating revenues up 6.2% to $8 billion, while combined retail and wholesale unit sales rose 3.3% to 392,357. Used retail unit sales were essentially flat, and comparable-store used unit sales fell 0.8%, but management emphasized that this came against a strong prior-year comparison.
Chief financial officer Enrique Mayor-Mora said the company has become more flexible in how it manages pricing, marketing and demand within the quarter. That showed up in a $230 decline in used vehicle gross profit per unit to $2,177, which was better than the larger near-term margin give-up management had outlined previously.
Barr said competitive pricing is already helping sales momentum build and should support market share gains through the year. He also said CarMax is feeding more local and vehicle-specific market inputs into its pricing algorithms, signaling a more dynamic approach to balancing sales and profitability.
CarMax Pushes Costs Lower to Fund PriceManagement tied much of the story to self-funded efficiency. Mayor-Mora said SG&A fell 3.7% to $635.2 million, while SG&A per total unit improved $118 to $1,619, helped by lower compensation and benefits costs even as advertising expense rose.
Barr said the larger aim is to fund better prices through leaner operations instead of relying on lower retail margins. He highlighted reconditioning, logistics and corporate overhead as the biggest areas where CarMax can create that flexibility.
Management reiterated that the company remains on track for $200 million in fiscal 2027 exit-rate savings. During Q&A, Mayor-Mora said first-quarter progress matched internal expectations, though he cautioned that year-over-year SG&A pressure could still show up in the balance of the year.
KMX Builds More Value in FinanceThe add-value pillar centered on CarMax Auto Finance and extended protection plans. CAF penetration rose 150 basis points year over year to 43.3%, while CAF income was $140.2 million, down 1.0%.
Senior vice president Jon Daniels said CarMax’s full-spectrum lending push is gaining traction, with CAF becoming the largest Tier 2 lender in the quarter. He said the company’s funding and underwriting work is giving it more room to expand penetration without changing its disciplined posture.
Management also said the EPP redesign is rolling out nationally and remains on track to add about $35 per unit in incremental margin during fiscal 2027. Together, finance and protection products were presented as recurring levers for improving transaction economics beyond used-vehicle retail margins alone.
CarMax Q&A Centers on Logistics and PricingAnalysts focused heavily on whether first-quarter trends marked a real turn in market share, and management answered with unusual directness. Barr told JPMorgan that CarMax has turned the corner and should continue to gain share on a sustainable basis.
Questions from Baird, BNP Paribas and Needham also pressed on logistics and reconditioning. Barr said CarMax transfers more than two million cars a year and needs to reduce unproductive moves, better align cars with location-specific demand and redesign the network for both lower costs and faster sales conversion.
On reconditioning, Barr and Mayor-Mora said the biggest upside lies in digitizing processes, improving labor and parts selection tools and moving inventory faster from acquisition to saleable condition. That answer added specificity to the run-lean pillar and showed where management sees a durable cost advantage.
KMX Sets Up a More Detailed Fall UpdateThe call’s overall tone was more operational than celebratory. Barr repeatedly said CarMax has strong assets, including its store network, brand and digital capabilities, but has not been executing at a level that fully captures them.
That left the quarter looking less like a finished turnaround and more like the opening phase of a broader reset. The planned fall strategic update now stands as the next key milestone for investors watching whether early gains in pricing, conversion and cost discipline can become more durable.
CarMax’s Zacks SignalsKMX currently carries a Zacks Rank #3 (Hold), along with a Value Score of B, Growth Score of C, Momentum Score of A and VGM Score of A. Based on the Zacks framework, a Zacks Rank #3 can be held, and stronger Style Scores carry more weight when they are paired with top Zacks Rank stocks. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The stock’s A grades for Momentum and VGM, plus its B for Value, indicate favorable style characteristics, while the C Growth Score reads as more balanced. Even so, the Zacks framework puts primary emphasis on earnings estimate revisions, which means the current Zacks Rank can change after analysts update forecasts following the just-reported results.
CarMax (NYSE:KMX) reported better-than-expected earnings for the first quarter on Wednesday.
The company posted quarterly earnings of $1.31 per share which beat the analyst consensus estimate of 94 cents per share. The company reported quarterly sales of $8.014 billion which beat the analyst consensus estimate of $7.410 billion.
The company introduced a new growth strategy centered on four pillars: improving offerings, enhancing customer experience, maximizing transaction value, and running lean operations. CarMax said the company remains on track to deliver $200 million in SG&A savings this fiscal year.
“I came to CarMax because I saw a strong foundation, an award-winning, people-first culture, and significant potential to unlock growth. Three months in, I am more convinced than ever that this is a business with everything it needs to thrive,” said Keith Barr, President and Chief Executive Officer.
CarMax shares rose 0.2% to $47.50 in pre-market trading.
These analysts made changes to their price targets on CarMax following earnings announcement.
B of A Securities analyst John Murphy maintained the stock with an Underperform rating and raised the price target from $40 to $45. Mizuho analyst David Bellinger maintained the stock with a Neutral and raised the price target from $38 to $43. Considering buying KMX stock? Here’s what analysts think:
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Key Takeaways KMX beat Q1 earnings and revenue estimates as total revenues rose 6.2% year over year.CarMax cut SG&A 3.7% and remains on track for $200M in exit-rate savings by fiscal 2027.KMX outlined a four-pillar strategy to drive unit growth, earnings growth and shareholder returns. CarMax, Inc. (KMX - Free Report) reported earnings per share of $1.31 for the first quarter of fiscal 2027, beating the Zacks Consensus Estimate of 94 cents by 39.61%. The bottom line declined 5.1% from $1.38 in the year-ago quarter.
Quarterly revenues rose 6.2% year over year to $8.01 billion, surpassing the consensus mark of $7.6 billion by 5.43%. Results benefited from higher retail and wholesale revenues, while combined retail and wholesale unit sales rose 3.3% to 392,357.
KMX Sales Rise on Higher Vehicle PricingFor the quarter ended May 31, 2026, CarMax’s total net sales and operating revenues were $8.01 billion, up from $7.55 billion a year ago. Used vehicle sales increased 4.7% to $6.39 billion, reflecting a higher average retail selling price.
Total retail used vehicle unit sales were nearly flat at 230,293 versus 230,210 in the prior-year quarter. Comparable-store used-unit sales declined 0.8%, as the company lapped a year-ago quarter that benefited from tariff-driven demand.
CarMax Wholesale Momentum Supports the Top LineWholesale vehicle sales rose 14% year over year to $1.43 billion. Wholesale unit sales increased 8.4% to 162,064, while the average wholesale selling price climbed 5.1% to $8,364.
The wholesale business helped offset pressure on retail profitability. Wholesale vehicle gross profit increased 8.3% to $169.5 million, with gross profit per wholesale unit of $1,046, essentially in line with $1,047 in the prior-year quarter.
KMX Margins Face Pricing PressureTotal gross profit declined 4.4% year over year to $854.4 million. Retail used vehicle gross profit fell 9.5% to $501.4 million, hurt by lower per-unit profitability.
Retail gross profit per used unit was $2,177, down $230 from last year’s all-time record due to the continuation of pricing actions aimed at driving an improved sales trend.
CarMax Cost Cuts Drive SG&A LeverageSelling, general and administrative expenses decreased 3.7% year over year to $635.2 million. The decline was primarily driven by lower compensation and benefits costs as the company made progress on targeted SG&A reductions.
SG&A per total unit improved 6.8% to $1,619, down $118 from the year-ago quarter. CarMax remains on track to achieve $200 million in SG&A exit-rate savings by the end of fiscal 2027.
KMX Finance Arm Expands PenetrationCarMax Auto Finance’s income was $140.2 million, down 1% from the year-ago quarter. The decline reflected lower auto loans outstanding following last year’s $900 million non-prime securitization, partly offset by interest earned on higher-margin receivables and servicing income.
CAF financed 43.3% of units sold after the impact of three-day payoffs, up 150 basis points year over year. The total interest margin percentage improved 20 basis points to 6.7%, while the weighted average contract rate was 11.3%, broadly in line with the prior-year quarter.
CarMax Strategy Focuses on Growth PillarsCEO Keith Barr introduced a four-pillar strategic framework focused on improving CarMax’s offering, simplifying the customer experience, adding value on each transaction and running lean. The company plans to share more details at a strategic update in late fall.
Pricing competitiveness, saleable inventory, digital-to-store conversion, CAF growth, EPP margin expansion, reconditioning efficiency and logistics improvements are key areas of focus for the company. The goal is to drive unit growth and earnings growth while supporting shareholder returns over time.
KMX’s Balance Sheet Remains in FocusCarMax ended the quarter with cash and cash equivalents of $132.2 million and inventory of $4.06 billion. Long-term debt excluding the current portion was $2.06 billion, while the current portion of long-term debt was $17.2 million.
The company did not repurchase shares during the first quarter. It had $1.31 billion remaining under its share repurchase authorization as of May 31, 2026, and intends to resume buybacks at an appropriate time depending on market conditions, leverage and capital needs. KMX carries a Zacks Rank #3 (Hold) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Peer ReleasesCarvana Co. (CVNA - Free Report) reported first-quarter 2026 (ended March 31, 2026) earnings of $1.69 per share, which beat the Zacks Consensus Estimate of $1.42 by 18.69% and increased from $1.51 in the year-ago quarter. Better-than-expected revenues across all segments drove the strong performance. Revenues of $6.43 billion beat the Zacks Consensus Estimate of $6.16 billion by 4.39% and increased 52% from last year.
AutoNation, Inc. (AN - Free Report) reported first-quarter 2026 (ended March 31, 2026) adjusted earnings of $4.69 per share, which missed the Zacks Consensus Estimate of $4.71 by 0.43%. Revenues totaled $6.55 billion, missing the Zacks Consensus Estimate of $6.66 billion by 1.6%. The top line declined from $6.69 billion reported in the first quarter of 2025. The results showed a familiar pattern: strong performance in higher-margin businesses was offset by weaker sales volumes and higher costs. Adjusted free cash flow was $255.6 million, with a solid 155% conversion of adjusted net income.
CarMax NYSE: KMX entered a market reversal earlier this year asc it transitioned to a new CEO and activist investors took positions. The story now is that Keith Barr’s four-pillar strategy to increase volume, improve digital sales, add value on each transaction, and drive efficiency is gaining traction.
The question is whether CarMax can preserve its cost savings and return to profitable growth in the coming quarters, and the early signs are encouraging. In this environment, CarMax remains in the middle of an evolving catalyst, with the stronger signal—sustained operational improvement—still to come.
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CarMax Outperforms in Q1, First Report With New CeoCarMax Today
$53.54 -0.12 (-0.23%)
As of 06/18/2026 03:59 PM Eastern
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52-Week Range$30.26▼
$71.99P/E Ratio34.99
Price Target$46.13
CarMax faced headwinds in Q1 fiscal year 2027 (FY2027), including uneven consumer demand and affordability pressure, but performed well, with unit volume increasing by 3.3% across the system.
Revenue grew by 6% to just over $8 billion, outperforming expectations by more than 780 basis points. Segmentally, wholesalers did the heavy lifting, with units up 8% compared to a basically flat retail side.
Lower relative pricing aided the strength and is reflected in the margin. The company managed to reduce selling, general, and administrative (SG&A) expenses and improve efficiency on a per-unit basis, but gross margin impairment offset these gains. The takeaway is that gross profit declined by nearly 5%, net margin contracted by approximately 50 basis points despite an improvement in SG&A, and GAAP earnings declined.
The offset is that earnings per share (EPS) of $1.31 outpaced consensus by a wide 34-cent margin, providing sufficient cash flow to sustain operations and maintain balance sheet quality. CarMax's balance sheet carries debt, but it did not provide any red flags for investors.
The company does not provide specific guidance on operational metrics, but it did offer color on what to expect this year. As it stands, the focus is on improving sales and customer satisfaction, which will put pressure on margins. That trade-off is important for investors to watch. Lower asking prices can help rebuild unit volume, while continued investment in digital services may weigh on profitability until those efficiencies scale.
Among the critical Q1 takeaways, however, are the 84% of retail unit sales supported by digital capabilities and 14% online retail sales, with digital channels central to reducing time-to-close, improving customer outcomes, and supporting longer-term operating efficiency.
Current Price$53.54High Forecast$66.00Average Forecast$46.13Low Forecast$35.00CarMax Stock Forecast Details
Analyst sentiment is central to CarMax’s 2025 stock price decline and 2026 rebound.
After price target cuts and weaker coverage weighed on KMX in 2025, the tone in 2026 has shifted toward cautious optimism as investors evaluate the CEO transition and early signs of operational improvement.
Analyst activity since February 2026 has included initiations, reaffirmed targets, and, more recently, price target increases that have helped stabilize the consensus estimate.
The consensus price target is around $42, below the current share price but aligning with the technical price floor put in place last year, and is likely to advance amid operational improvements and strengthen the expected catalyst.
Institutional trends look more bullish despite mixed activity over the trailing 12-month period. Selling outweighed buying in parts of 2025, but activity in the first half of 2026 suggests renewed accumulation. More importantly, the periods of accumulation and distribution align with CarMax’s price action, revealing group buying on dips and market support at the lower end of its trading range.
The likely outcome is that KMX's downside is limited, and institutional support will strengthen and advance in subsequent quarters.
CarMax Catalysts: There Is More Than One Coming Down the PipeCarMax has several catalysts coming down the pike, centered on its upcoming earnings reports. The reports are expected to show improvements, including cash flow and future profitability. Among the catalysts is the capacity for capital return, which centers on share buybacks.
CarMax paused share repurchases in the latest quarter, but prior buybacks have still reduced the company’s share count over the past year. A resumption of repurchases could become a bullish catalyst if earnings stabilize. Management is also expected to provide more details on its turnaround strategy later this year.
Chart price action is not bullish following the release. The market for KMX stock is down more than 5% and may continue to decline in the near term. The caveat is that this market appears in the midst of a Double-Bottom Reversal, and the mid-June pullback is testing critical support.
Assuming support holds, KMX shares could advance this summer, potentially reaching $70 by early Fall. If not, a move to retest recent lows near $37.50 is probable—lower lows are not expected to come this year.
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In one of the more significant gear shifts on the stock market Thursday, CarMax (KMX +13.13%) roared to a 13% gain after sputtering to a 9% loss the previous trading session. The auto retailer's equity benefited from several positive post-earnings analyst notes; among these was a recommendation upgrade.
Foot on the gas CarMax published its first quarter of fiscal 2027 results on Wednesday morning, and investors reacted negatively, despite convincing top- and bottom-line beats.
Image source: Getty Images.
But Thursday saw analysts weigh in with adjusted takes on the stock, and most of these changes were bullish.
For example, big bank JPMorgan Chase's J.P. Morgan bumped its price target $1 higher to $38, although it maintained its underweight (i.e., sell) recommendation. Baird was more hopeful, raising its price target to $55 per share from $48; it kept its outperform (buy) rating intact.
Of the numerous analyst adjustments, the most impactful was the one made by Stephens pundit Jeff Lick. He upped his outlook on CarMax to overweight (buy) from his preceding equal weight (hold). In doing so, he lifted his price target significantly, to $66 per share from $43.
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Top dog According to reports, Lick wrote that CarMax has the ability to remain the No. 1 used-car retailer in this country. Even if its position weakens to some extent, in his view, it's still a go-to for many customers looking to buy in that segment.
To me, CarMax's quarterly performance was impressive, with top-line growth of 6% year over year in a fairly challenging environment for auto sales. Assuming it can maintain, or at least approach, such growth numbers, its stock should generally do well.
JPMorgan Chase is an advertising partner of Motley Fool Money. Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends CarMax and JPMorgan Chase. The Motley Fool has a disclosure policy.
CarMax (KMX) is in a transition phase, executing a four-pillar strategy to enhance customer experience and operational efficiency. KMX reported strong Q1 results, beating EPS and revenue expectations, with management crediting early execution of its strategic plan. Technical analysis signals a bullish trend: KMX trades above its 30-week EMA, with both short- and long-term momentum turning positive.
CarMax, Inc. (NYSE:KMX) will release earnings for its first quarter before the opening bell on Wednesday, June 17.
Analysts expect the Richmond, Virginia-based company to report quarterly earnings of 94 cents per share. That's down from $1.38 per share in the year-ago period. The consensus estimate for CarMax's quarterly revenue is $7.42 billion. It reported $7.55 billion last year, according to Benzinga Pro.
On April 14, CarMax posted better-than-expected earnings for the fourth quarter.
CarMax shares fell 0.6% to close at $51.26 on Friday.
Benzinga readers can access the latest analyst ratings on the Analyst Stock Ratings page. Readers can sort by stock ticker, company name, analyst firm, rating change or other variables.
Let's have a look at how Benzinga's most-accurate analysts have rated the company in the recent period.
Considering buying KMX stock? Here’s what analysts think:
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CarMax, Inc. (NYSE:KMX) will release earnings for its first quarter before the opening bell on Wednesday, June 17.
Analysts expect the Richmond, Virginia-based company to report quarterly earnings of 94 cents per share. That's down from $1.38 per share in the year-ago period. The consensus estimate for CarMax's quarterly revenue is $7.42 billion. It reported $7.55 billion last year, according to Benzinga Pro.
On April 14, CarMax posted better-than-expected earnings for the fourth quarter.
CarMax shares fell 0.6% to close at $51.26 on Friday.
Benzinga readers can access the latest analyst ratings on the Analyst Stock Ratings page. Readers can sort by stock ticker, company name, analyst firm, rating change or other variables.
Let's have a look at how Benzinga's most-accurate analysts have rated the company in the recent period.
Considering buying KMX stock? Here’s what analysts think:
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Carmax NYSE: KMX shares are trading near five-year lows, offering an intriguing opportunity. However, as insulated as it is from financial implosion, market forces are aligned to keep this stock from rising.
CarMax Today
$50.99 -0.58 (-1.12%)
As of 12:11 PM Eastern
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52-Week Range$30.26▼
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Price Target$41.73
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The takeaway from the fiscal Q4 20256 results and foward guidance is that business conditions are less than optimal, so bad, in fact, that management paused its share buybacks in order to preserve capital. This is a very significant detail, as the fiscal year 2025 (FY2025) buyback activity reduced the count by a high single-digit amount.
The likely outcome is that Carmax weathers the changes well and comes out ahead. The question is how long it may take and how low the stock price may go before it does.
Carmax Near Price Floor: Sell-Side Support Isn’t FirmTechnically speaking, this stock is trading near a potential price floor in early Q2 2026, aligned with COVID-19 era lows. The problem is that the 2020 activity led to a quick turnaround, while price action in 2026 languishes at low levels with nothing to invigorate buyers. Analysts, who might put a floor in the action, are unlikely to, given the guidance update and sentiment trend.
The data tracked by MarketBeat reveals a high conviction Reduce rating, based on 18 analysts, and sentiment has been deteriorating. The 2026 trend includes numerous downgrades and price target reductions, with consensus assuming fair value near the technical floor and the low end at $28. In this scenario, KMX stock can easily fall to fresh lows and then shed more than 25% before hitting bottom.
And short sellers are selling into this market. The short interest isn’t astronomically high at 10%, but it has been increasing in recent reports and would be sufficient to provide a headwind for price action. Additionally, short interest may increase, given the pause in buybacks and potential weakness in upcoming reports. The deciding factor will be the institutions. They own a significant 99% of the market, and their activity is ambiguous.
The data reflects institutional accumulation in early 2026, ahead of the Q1 release, but the trailing 12-month balance is even. Selling and buying are balanced, reflecting a market in limbo and highly susceptible to news. The risk is that the 2026 guidance and buyback activity lead them into outright distribution and send the stock price through its critical support target to fresh lows. Short-sellers are likely to lean into their trade in that scenario, adding momentum and depth to any price decline that comes.
Carmax Headwinds Build, Impair Outlook for 2026Carmax struggled in its fiscal Q4, with margins declining amid weak demand and pricing actions. The company’s total unit sales increased by 0.7%, led by a 3% advance in Wholesale and offset by an 0.8% decline in retail. Comp units fell by nearly 2%. Total retail sales fell by more than 1%, and guidance didn’t leave the market feeling optimistic.
Margin news was also poor. The adjusted earnings per share came in above MarketBeat’s reported consensus, despite being affected by one-offs and overshadowed by weak margin guidance. The critical details are that the adjusted 34 cents in earnings was down more than 40% year over year, including the positive impact of share buybacks. Margin contraction is expected to continue.
Rising Debt and Margin Impairment Sap Enthusiasm for KMX StockOther bad news includes the balance sheet and debt levels. The company isn’t on the verge of bankruptcy, but 2025 activities resulted in reduced cash, increased inventory, and less equity, with leverage above target and weakness expected in the year ahead. Guidance forecasts additional cost savings from turnaround efforts, but these are offset by reduced margins and overall profitability.
Risks include a shrinking margin and the impact of intense competition. Carmax is behind the curve on its digital offerings and is struggling to gain share against operators such as Carvana. Its end-to-end digital process resonates with consumers, enabling quick, easy access to hassle-free automobile shopping. Carmax has similar features but achieves only a low double-digit percentage of 100% digital sales. Carvana NYSE: CVNA, on the other hand, sells more of its vehicles digitally and realizes higher margins as a result.
Catalysts this year will include operational improvements linked to the new CEO. Keith Barr took over earlier this year and is expected to drive operational improvements alongside digitization. Market share gains are also possible, as smaller used-car dealers are forced to consolidate. The question is whether Carmax can capitalize on the opportunity ahead of its competitors and do it profitably. Interest rate trends may also improve, increasing consumer appetite for pre-owned cars. As it is, the market is pricing in a slow pace of rate reduction, with the next cut not priced into futures trading until sometime in 2027.
Should You Invest $1,000 in CarMax Right Now?Before you consider CarMax, you'll want to hear this.
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CarMax (KMX 1.22%) shares declined 13.3% in the week to Friday morning. The decline came after a disappointing fourth-quarter 2026 earnings report released earlier in the week.
Challenging end markets CarMax has a new CEO in place, and Keith Barr (appointed in mid-March) faces an immediate challenge in dealing with difficult end markets. The consumer automotive market is price-sensitive at the moment, and, as many automakers found out last year, it's moving toward lower-priced models.
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That observation holds for new cars and the kind of used cars that CarMax sells. Consequently, CarMax sought to lower the average selling price of its vehicles to drive volume growth. CFO Enrique Mayor-Mora discussed the matter on the earnings call and disclosed that of the three levers (increased marketing, better online selling capability, and lower prices) the company pulled to drive 0.7% unit sales growth in the quarter, "we do believe that our lower pricing had the biggest impact on the quarter."
The result was a drop in average selling prices of used vehicles (down 0.4% to $26,019) and wholesale vehicle prices (down 3.3% to $7,776), but a combined (used and wholesale). Unfortunately, the mix led to a lower gross profit of $605.3 million in the quarter, down 9.4% from the same quarter of last year.
Image source: Getty Images.
Where next for CarMax There isn't a lot the company can do about its end markets. Still, it can restructure to better deal with them, and Barr's plans reduce expenses by $200 million in its fiscal 2027, which makes sense, not least as it will help the company deal with margin challenges coming from having to lower prices. In addition, management announced it had bought relatively more used cars from consumers than from dealers, which should help profitability.In short, it's a game of blocking and tackling as the company navigates a difficult trading environment.
Lee Samaha has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends CarMax. The Motley Fool has a disclosure policy.
Shares of CarMax (KMX 1.22%) took a significant hit recently, dropping sharply following the company's latest quarterly earnings report. The decline added to an already tough backdrop for the stock. Shares are now down 37% over the last 12 months and 69% over the past five years.
With the stock price taking a beating, investors may be wondering if the used-car retailer is finally trading at a bargain. After all, beneath the headline losses, the company did see sequential improvements in its sales volume.
But a closer look at the company's financial health, management's decision to pause share repurchases, and the stock's valuation suggests investors may want to exercise some caution.
Image source: Getty Images.
A transition period For its fiscal fourth quarter of 2026 (the period ended Feb. 28, 2026), CarMax reported net sales and operating revenues of roughly $5.95 billion. This represented a 1% decline from the year-ago period.
While a decline isn't exactly what investors want to see, it actually marked a meaningful improvement from the fiscal third quarter, when revenue fell 7% year over year.
The underlying unit volume tells a similar story. Retail used unit sales slipped 0.8% year over year in fiscal Q4 -- a significant improvement compared to the 8% decline the company saw in fiscal Q3.
Management pointed out that it achieved this improvement in sales trends by lowering prices and increasing its marketing spend.
"We felt like, lower the prices, get sales moving in the right direction, and then pay for it by taking cost out of the business," explained interim executive chair Tom Folliard during the company's fiscal fourth-quarter earnings call.
When asked about the exact drivers of the improved volume, CarMax chief financial officer Enrique Mayor-Mora added: "I would tell you, out of those three things, pricing certainly we believe had the biggest impact, although we think all of those levers impacted our trend positively."
But these price cuts seem to have come at a cost to the company's profitability.
CarMax's gross profit margin contracted, with its total gross profit falling 9% year over year to $605 million during the quarter. And the bottom line was even uglier. The company reported a net loss of $121 million, or $0.85 per share -- though this was heavily weighed down by a $141 million non-cash goodwill impairment charge and restructuring costs. When excluding these items, adjusted earnings per share came in at $0.34 -- a sharp decline from the $0.64 it reported in the same quarter last year.
A paused buyback program In addition to margin pressure, another issue could be keeping investors on the sidelines: CarMax paused its share repurchases.
During the fourth quarter, the company repurchased only about $50 million of its stock before halting the program (it repurchased $632 million for the full fiscal year).
Mayor-Mora noted that the decision was made because the company's leverage is currently "slightly above the targeted range."
For a company that has historically used share buybacks to return capital to shareholders and support earnings-per-share growth, this pause is notable.
And this cautious capital allocation approach comes during a broader leadership transition, as newly appointed chief executive officer Keith Barr, who took the helm in March, is leading efforts to improve execution and drive efficiencies.
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Time to buy? With the business clearly in a transition period, what should investors make of the stock's valuation?
Even after the recent sell-off, CarMax stock arguably isn't cheap enough to make it a compelling buy. Based on its trailing 12-month adjusted earnings, shares trade at a price-to-earnings ratio of about 14.
While that multiple may not seem overly expensive on the surface, it leaves very little room for error, given the company's soft sales, contracting margins, and elevated debt levels.
Further, the used-car market remains highly sensitive to interest rates and consumer affordability challenges -- somewhat unpredictable macroeconomic factors.
Ultimately, while the company's slight improvement in retail unit sales volume is encouraging, the overall picture remains murky -- and the stock looks closer to fairly valued than clearly undervalued. CarMax's combination of soft top-line growth, a paused share repurchase program, and a leadership transition introduces a level of uncertainty that makes the stock worth avoiding unless it falls to a price at which it is trading as a clear bargain.
Car rental and used car stocks are seeing a wide divergence in their performance. Three notable names across these industries are Avis Budget Group NASDAQ: CAR, CarMax NYSE: KMX, and Carvana NYSE: CVNA. Among them, 52-week returns stretch from falls of 30% to gains of nearly 500%. Let’s break down what’s driving the differing performance within this group and what Wall Street analysts are calling for next.
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Avis Catapults on Suspected Short SqueezeOver the past 52 weeks, the return of Avis Budget Group exceeds 450% and is approaching the 500% mark. Since the end of March alone, Avis shares are up more than 200%, with the stock posting nine single-day gains of 10% or more. Analysts have largely attributed the explosive rise in Avis to a short squeeze.
Avis Budget Group Today
CAR
Avis Budget Group
$186.62 -2.99 (-1.58%)
As of 12:11 PM Eastern
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52-Week Range$85.96▼
$847.70Price Target$129.63
Short squeezes can occur when investors sell a large percentage of a company’s floated shares short. When the stock rises, short sellers must buy the stock to cover their positions and prevent larger losses. This causes the stock to rise even more, creating a vicious cycle of short covering and price increases.
At the end of March, investors sold short around 54% of Avis’s floated shares. This level of short interest is extremely high, making Avis a prime short-squeeze candidate.
More recent reports indicated that short interest has since increased to 58%. This signals that new traders are entering short positions amid Avis’s rise, making further squeezes possible.
Still, it is important to note that wagering on potential short squeezes is extremely risky. Stocks affected by these technical trading dynamics can plummet just as fast as they rise, as fundamentals often don’t align with valuations.
Avis Budget Group, Inc. (CAR) Price Chart for Friday, June, 12, 2026
Demonstrating this is the fact that Avis’s revenue fell by 1% in 2025, yet the stock trades at a forward price-to-earnings ratio near 130X. Furthermore, Wall Street analysts have a highly bearish outlook on Avis. The MarketBeat consensus price target of $115 implies downside in the stock of about 75%.
CarMax Sees Big Losses Moves Amid CEO Departure, Falling SalesMeanwhile, vehicle reseller CarMax is down more than 30% over the past 52 weeks. CarMax has seen several huge single-day losses during this time. This includes a 24% single-day drop in November 2025, after CarMax announced its CEO would step down, and the company provided extremely poor guidance.
CarMax Today
$50.99 -0.58 (-1.12%)
As of 12:11 PM Eastern
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52-Week Range$30.26▼
$71.99P/E Ratio31.81
Price Target$41.73
At that time, CarMax said its comparable sales would fall by 8% to 12% in its Q3 fiscal year 2026. Note that CarMax’s fiscal reporting period is several quarters ahead of the calendar period.
The company also noted that its earnings per share (EPS) would come in between 18 cents and 36 cents. Analysts had forecasted a comparable sales drop near 3%, and EPS above 60 cents. CarMax ended up posting a comparable sales decline of 9% and EPS of 43 cents.
These were both better than the company’s midpoint guidance, but the stock still fell in response. Despite posting beats in its April 2026 earnings report, the stock tanked another 15% afterward, reflecting a lack of longer-term confidence among investors.
Wall Street analysts are generally echoing this uncertainty. The MarketBeat consensus price target of $41.21 implies the stock is fairly valued. However, targets updated after the company’s latest earnings report average around $35.50, implying more than 10% downside.
Carvana Grows Car Sales by 43% as CarMax DeclinesCarMax’s fall is largely attributable to the rise of Carvana. CVNA stock is up more than 80% over the past 52 weeks, as the company continues to take market share from legacy used car resellers like CarMax. In 2025, Carvana sold 596,641 cars to retail customers, up 43% year over year (YOY). Meanwhile, CarMax sold 780,684 cars to consumers in its FY2026, falling 1.1% YOY. One year ago, Carvana sold just 416,348 retail vehicles to CarMax’s nearly 789,050. This shows how Carvana’s customer base is rapidly increasing while CarMax’s is deteriorating.
Carvana Today
$63.91 -3.91 (-5.77%)
As of 12:11 PM Eastern
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52-Week Range$54.46▼
$97.38P/E Ratio38.85
Price Target$93.14
As opposed to CarMax, which operates over 250 traditional showrooms, Carvana has no stores. Buying and selling happens completely online, as the firm picks up cars from sellers, refurbishes them, and delivers them to eventual buyers. Given the growth of both firms, Carvana’s model is clearly resonating with customers.
Looking ahead, analysts have a moderately bullish tilt on Carvana stock. The MarketBeat consensus price target near $435 implies around 10% upside in shares. However, several targets updated in April are significantly lower. The average of April updates so far is $411, implying around 5% upside. Notably, these updated targets stretch as high as $475 and as low as $335. Carvana will report its Q1 2026 financials in late April, which could cause considerable shifts in price targets.
Avis Stands Alone, CarMax and Carvana Jockey for ShareAvis Budget Group stock is being driven primarily by technical factors rather than its positioning in the broader rental car market. Meanwhile, the stories of CarMax and Carvana are on opposite ends of the same spectrum, as Carvana disrupts the resale market.
Notably, Carvana has high long-term expectations for itself. The company hopes to reach 3 million annual retail vehicle sales sometime between 2030 and 2035. This would require significant annual growth in the range of 18% to 38%.
Should You Invest $1,000 in Avis Budget Group Right Now?Before you consider Avis Budget Group, you'll want to hear this.
MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Avis Budget Group wasn't on the list.
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NEW YORK, April 21, 2026 (GLOBE NEWSWIRE) -- Pomerantz LLP is investigating claims on behalf of investors of CarMax, Inc. (“CarMax” or the “Company”) (NYSE: KMX). Such investors are advised to contact Danielle Peyton at [email protected] or 646-581-9980, ext. 7980.
The investigation concerns whether CarMax and certain of its officers and/or directors have engaged in securities fraud or other unlawful business practices.
[Click here for information about joining the class action]
On April 14, 2026, CarMax issued a press release reporting its financial results for the fourth quarter and fiscal year of 2026. Despite its fourth-quarter results meeting or exceeding expectations for same-store sales and revenue, on a related earnings call, Company management indicated that it would, among other things, lower prices for used cars and increase its appetite for customers with lower credit scores to mitigate the impacts of an affordability crisis in the auto industry.
On this news, CarMax’s stock price fell $7.42 per share, or 15.12%, to close at $41.66 per share on April 14, 2026.
Pomerantz LLP, with offices in New York, Chicago, Los Angeles, London, Paris, and Tel Aviv, is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, Pomerantz pioneered the field of securities class actions. Today, more than 85 years later, Pomerantz continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members. See www.pomlaw.com.
Attorney advertising. Prior results do not guarantee similar outcomes.
On April 21, 2026, CarMax Inc (KMX) shares fell 4.0% to $39.04, continuing a downward trend that has seen the stock decline 6.3% over the past week and 6.7% ove
NEW YORK, April 28, 2026 (GLOBE NEWSWIRE) -- Pomerantz LLP is investigating claims on behalf of investors of CarMax, Inc. (“CarMax” or the “Company”) (NYSE: KMX). Such investors are advised to contact Danielle Peyton at [email protected] or 646-581-9980, ext. 7980.
The investigation concerns whether CarMax and certain of its officers and/or directors have engaged in securities fraud or other unlawful business practices.
[Click here for information about joining the class action]
On April 14, 2026, CarMax issued a press release reporting its financial results for the fourth quarter and fiscal year of 2026. Despite its fourth-quarter results meeting or exceeding expectations for same-store sales and revenue, on a related earnings call, Company management indicated that it would, among other things, lower prices for used cars and increase its appetite for customers with lower credit scores to mitigate the impacts of an affordability crisis in the auto industry.
On this news, CarMax’s stock price fell $7.42 per share, or 15.12%, to close at $41.66 per share on April 14, 2026.
Pomerantz LLP, with offices in New York, Chicago, Los Angeles, London, Paris, and Tel Aviv, is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, Pomerantz pioneered the field of securities class actions. Today, more than 85 years later, Pomerantz continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members. See www.pomlaw.com.
Attorney advertising. Prior results do not guarantee similar outcomes.
, /PRNewswire/ -- Pomerantz LLP is investigating claims on behalf of investors of CarMax, Inc. ("CarMax" or the "Company") (NYSE: KMX). Such investors are advised to contact Danielle Peyton at [email protected] or 646-581-9980, ext. 7980.
The investigation concerns whether CarMax and certain of its officers and/or directors have engaged in securities fraud or other unlawful business practices.
[Click here for information about joining the class action]
On April 14, 2026, CarMax issued a press release reporting its financial results for the fourth quarter and fiscal year of 2026. Despite its fourth-quarter results meeting or exceeding expectations for same-store sales and revenue, on a related earnings call, Company management indicated that it would, among other things, lower prices for used cars and increase its appetite for customers with lower credit scores to mitigate the impacts of an affordability crisis in the auto industry.
On this news, CarMax's stock price fell $7.42 per share, or 15.12%, to close at $41.66 per share on April 14, 2026.
Pomerantz LLP, with offices in New York, Chicago, Los Angeles, London, Paris, and Tel Aviv, is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, Pomerantz pioneered the field of securities class actions. Today, more than 85 years later, Pomerantz continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members. See www.pomlaw.com.
Attorney advertising. Prior results do not guarantee similar outcomes.
, /PRNewswire/ -- Pomerantz LLP is investigating claims on behalf of investors of CarMax, Inc. ("CarMax" or the "Company") (NYSE: KMX). Such investors are advised to contact Danielle Peyton at [email protected] or 646-581-9980, ext. 7980.
The investigation concerns whether CarMax and certain of its officers and/or directors have engaged in securities fraud or other unlawful business practices.
[Click here for information about joining the class action]
On April 14, 2026, CarMax issued a press release reporting its financial results for the fourth quarter and fiscal year of 2026. Despite its fourth-quarter results meeting or exceeding expectations for same-store sales and revenue, on a related earnings call, Company management indicated that it would, among other things, lower prices for used cars and increase its appetite for customers with lower credit scores to mitigate the impacts of an affordability crisis in the auto industry.
On this news, CarMax's stock price fell $7.42 per share, or 15.12%, to close at $41.66 per share on April 14, 2026.
Pomerantz LLP, with offices in New York, Chicago, Los Angeles, London, Paris, and Tel Aviv, is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, Pomerantz pioneered the field of securities class actions. Today, more than 85 years later, Pomerantz continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members. See www.pomlaw.com.
Attorney advertising. Prior results do not guarantee similar outcomes.
RICHMOND, Va.--(BUSINESS WIRE)--CarMax, Inc. (NYSE: KMX) (“CarMax” or the “Company”), the nation's largest retailer of used cars, today announced that it intends to add Robert O'Shaughnessy to the Company's Board of Directors (the “Board”), subject to shareholder approval at the Company's 2026 Annual Meeting of Shareholders (the “Annual Meeting”). Additionally, the Company announced the planned retirements of Shira Goodman and Mitchell Steenrod, each of whom will not stand for re-election. “We.
NEW YORK, May 12, 2026 (GLOBE NEWSWIRE) -- Pomerantz LLP is investigating claims on behalf of investors of CarMax, Inc. (“CarMax” or the “Company”) (NYSE: KMX). Such investors are advised to contact Danielle Peyton at [email protected] or 646-581-9980, ext. 7980.
The investigation concerns whether CarMax and certain of its officers and/or directors have engaged in securities fraud or other unlawful business practices.
[Click here for information about joining the class action]
On April 14, 2026, CarMax issued a press release reporting its financial results for the fourth quarter and fiscal year of 2026. Despite its fourth-quarter results meeting or exceeding expectations for same-store sales and revenue, on a related earnings call, Company management indicated that it would, among other things, lower prices for used cars and increase its appetite for customers with lower credit scores to mitigate the impacts of an affordability crisis in the auto industry.
On this news, CarMax’s stock price fell $7.42 per share, or 15.12%, to close at $41.66 per share on April 14, 2026.
Pomerantz LLP, with offices in New York, Chicago, Los Angeles, London, Paris, and Tel Aviv, is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, Pomerantz pioneered the field of securities class actions. Today, more than 85 years later, Pomerantz continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members. See www.pomlaw.com.
Attorney advertising. Prior results do not guarantee similar outcomes.
A month has gone by since the last earnings report for CarMax (KMX - Free Report) . Shares have lost about 8.5% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is CarMax due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the latest earnings report in order to get a better handle on the important drivers.
CarMax Q4 Earnings Surpass ExpectationsCarMax posted adjusted earnings per share of 34 cents for the fourth quarter of fiscal 2026, beating the Zacks Consensus Estimate of 22 cents by 57.63%. The adjusted bottom line declined 46.9% from 64 cents in the year-ago quarter.
Quarterly revenues came in at $5,946 million, edging past the Zacks Consensus Estimate of $5,770 million by 3.01% but slipping 1% year over year. Results reflected pricing actions aimed at improving the retail sales trend, which weighed on per-unit profitability.
Pricing Actions Weigh on Retail ProfitabilityFor the quarter ended Feb. 28, 2026, KMX reported total gross profit of $605.3 million, down 9.4% from the year-ago period. The decline was led by the retail business, where used-vehicle gross profit fell 9.6%.
Retail used gross profit per unit was $2,115, down $207 from last year’s record fourth quarter. Management attributed the decline to pricing actions implemented to drive an improved sales trend. Total retail used vehicle unit sales dipped 0.8% to 181,188, and comparable store used units decreased 1.9%.
CarMax’s wholesale results were mixed. Wholesale units increased 3% to 122,781, but gross profit per wholesale unit declined by $105 to $940. Other gross profit decreased 10.6%, primarily reflecting a reduction in service department margins.
SG&A Discipline Takes Shape Alongside RestructuringSelling, general and administrative expenses were $611.3 million, essentially flat versus the prior-year quarter. The total included $33.9 million in restructuring charges impacting compensation and benefits and occupancy costs, as well as higher advertising expenses, which were offset by items like a reduced corporate bonus accrual, lower stock-based compensation expense and savings tied to a Customer Experience Center workforce reduction earlier in fiscal 2026.
Excluding restructuring charges, adjusted SG&A expenses were $577.4 million, down $33.1 million, or 5.4%, year over year. Even with that progress, SG&A as a percent of gross profit rose to 101% from 91.4% a year ago as gross profit dollars contracted.
CarMax raised its targeted SG&A reductions to $200 million in exit-rate savings by the end of fiscal 2027, up from the prior goal of $150 million. The company also said that it will shift its SG&A efficiency focus to a per total unit metric (retail and wholesale), which management views as better aligned with driving unit volume.
CAF Income Falls as Credit Strategy Continues to EvolveCarMax Auto Finance (“CAF”) income decreased 9.8% year over year to $143.7 million in the fiscal fourth quarter. The company cited a lower balance of auto loans outstanding following a $900 million non-prime securitization completed in the third quarter, along with a higher provision for loan losses tied to CAF’s expansion across the credit spectrum.
CAF’s total interest margin percentage was 6.3% of average auto loans outstanding, up 10 basis points from the year-ago period. The provision for loan losses increased to $73.9 million from $68.3 million a year ago, reflecting higher Tier 2 penetration associated with the broader credit strategy.
On the volume side, after the impact of three-day payoffs, CAF financed 42.8% of units sold in the quarter, up from 42.3% in the prior-year quarter. The weighted average contract rate was 11.1%, unchanged from a year earlier.
Capital Allocation, Liquidity and Fiscal 2027 Spending PlansKMX repurchased 1.3 million shares for $50.4 million during the quarter before pausing additional purchases. For fiscal 2026, the company repurchased 11.8 million shares for $631.8 million, and it finished the year with $1.31 billion remaining under its authorization.
CarMax ended fiscal 2026 with cash and cash equivalents of $122.8 million and inventory of $4.14 billion. Long-term debt excluding the current portion was $2.01 billion, while the current portion of long-term debt was $217.3 million.
On the growth front, the company opened one new store location in Florence, KY, and one stand-alone reconditioning/auction center in Frederick, MD, during the quarter. For fiscal 2027, CarMax plans to open four new stores, two stand-alone reconditioning/auction centers and two stand-alone auction facilities, with capital expenditures expected to be approximately $400 million.
How Have Estimates Been Moving Since Then?It turns out, estimates review have trended downward during the past month.
The consensus estimate has shifted -17.55% due to these changes.
VGM ScoresCurrently, CarMax has a average Growth Score of C, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of A on the value side, putting it in the top 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
OutlookEstimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Interestingly, CarMax has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
, /PRNewswire/ -- Pomerantz LLP is investigating claims on behalf of investors of CarMax, Inc. ("CarMax" or the "Company") (NYSE: KMX). Such investors are advised to contact Danielle Peyton at [email protected] or 646-581-9980, ext. 7980.
The investigation concerns whether CarMax and certain of its officers and/or directors have engaged in securities fraud or other unlawful business practices.
[Click here for information about joining the class action]
On April 14, 2026, CarMax issued a press release reporting its financial results for the fourth quarter and fiscal year of 2026. Despite its fourth-quarter results meeting or exceeding expectations for same-store sales and revenue, on a related earnings call, Company management indicated that it would, among other things, lower prices for used cars and increase its appetite for customers with lower credit scores to mitigate the impacts of an affordability crisis in the auto industry.
On this news, CarMax's stock price fell $7.42 per share, or 15.12%, to close at $41.66 per share on April 14, 2026.
Pomerantz LLP, with offices in New York, Chicago, Los Angeles, London, Paris, and Tel Aviv, is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, Pomerantz pioneered the field of securities class actions. Today, more than 85 years later, Pomerantz continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members. See www.pomlaw.com.
Attorney advertising. Prior results do not guarantee similar outcomes.
NEW YORK, May 19, 2026 (GLOBE NEWSWIRE) -- Pomerantz LLP is investigating claims on behalf of investors of CarMax, Inc. (“CarMax” or the “Company”) (NYSE: KMX). Such investors are advised to contact Danielle Peyton at [email protected] or 646-581-9980, ext. 7980.
The investigation concerns whether CarMax and certain of its officers and/or directors have engaged in securities fraud or other unlawful business practices.
[Click here for information about joining the class action]
On April 14, 2026, CarMax issued a press release reporting its financial results for the fourth quarter and fiscal year of 2026. Despite its fourth-quarter results meeting or exceeding expectations for same-store sales and revenue, on a related earnings call, Company management indicated that it would, among other things, lower prices for used cars and increase its appetite for customers with lower credit scores to mitigate the impacts of an affordability crisis in the auto industry.
On this news, CarMax’s stock price fell $7.42 per share, or 15.12%, to close at $41.66 per share on April 14, 2026.
Pomerantz LLP, with offices in New York, Chicago, Los Angeles, London, Paris, and Tel Aviv, is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, Pomerantz pioneered the field of securities class actions. Today, more than 85 years later, Pomerantz continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members. See www.pomlaw.com.
Attorney advertising. Prior results do not guarantee similar outcomes.
, /PRNewswire/ -- Pomerantz LLP is investigating claims on behalf of investors of CarMax, Inc. ("CarMax" or the "Company") (NYSE: KMX). Such investors are advised to contact Danielle Peyton at [email protected] or 646-581-9980, ext. 7980.
The investigation concerns whether CarMax and certain of its officers and/or directors have engaged in securities fraud or other unlawful business practices.
[Click here for information about joining the class action]
On April 14, 2026, CarMax issued a press release reporting its financial results for the fourth quarter and fiscal year of 2026. Despite its fourth-quarter results meeting or exceeding expectations for same-store sales and revenue, on a related earnings call, Company management indicated that it would, among other things, lower prices for used cars and increase its appetite for customers with lower credit scores to mitigate the impacts of an affordability crisis in the auto industry.
On this news, CarMax's stock price fell $7.42 per share, or 15.12%, to close at $41.66 per share on April 14, 2026.
Pomerantz LLP, with offices in New York, Chicago, Los Angeles, London, Paris, and Tel Aviv, is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, Pomerantz pioneered the field of securities class actions. Today, more than 85 years later, Pomerantz continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members. See www.pomlaw.com.
Attorney advertising. Prior results do not guarantee similar outcomes.
A 21-year-old welder from Mississippi called into The Ramsey Show with a math problem most readers will never see on a calculator: $30,000 in debt on a truck at 30% interest, paid down with $800 a month out of a $3,200 monthly take-home check. Co-host George Kamel did not soften his reaction.
“Whoever did that is a terrible, terrible person taking advantage of a 21-year-old kid who’s trying to take care of his dad with cancer.”
A loan at this rate actively transfers wealth from the borrower to the lender on a schedule the borrower cannot outrun without selling the collateral. If you are a young worker shopping for a vehicle and a dealer waves you toward a finance office instead of a price negotiation, this article is the math you need to see first.
The verdict: The math is brutal Co-host Jade Warshaw’s exit advice was blunt: sell the truck, take a personal loan from a credit union to cover the gap, and never sit inside a 30% auto loan one month longer than required. “I don’t care. I don’t care how you need to get this loan. Nothing’s going to be worse than 30%.” That is the correct call.
The Federal Reserve’s benchmark borrowing rate sits at just under 4%. The caller’s truck loan sits at 30%. That is more than 25 percentage points above the benchmark. Banks do not price risk that high. Subprime dealer finance offices do, because the collateral sits on their lot and can be repossessed on day 31 of nonpayment.
On a standard 72-month auto loan at 30%, the monthly payment lands near $900, and total interest paid over the life of the loan roughly equals the original price of the truck. A buyer pays for the vehicle twice. At $800 a month, the caller is barely outrunning the interest charge, which is why he is upside down by $10,000 a year into the loan. The principal has barely moved.
Layer in the cash flow: $3,200 a month after taxes against an $800 truck payment and $250 a week in diesel means fuel and the loan alone consume more than half his income. With WTI crude near $102 per barrel, sitting in the 94th percentile of the past year’s range, that fuel line is not shrinking. The vehicle is eating the worker.
Why budgeting won’t fix this A welder earning $3,200 a month takes home roughly $18 an hour at full-time, against a national private-sector average of about $37 per hour in April 2026. He earns about half the national average. The consumer price index has climbed from 317.671 in January 2025 to 333.020 in April 2026, and the national savings rate has fallen from 6.2% in Q1 2024 to 4.0% in Q1 2026. There is no budgeting trick that closes a 30% interest gap when wages are below average and the cost of living is rising.
The variable that decides everything: the gap between loan balance and resale value The single number that determines whether a buyer can escape a high-rate auto loan is the spread between what the vehicle would sell for today and what is owed on it. This caller is upside down by $10,000. That gap, not the interest rate itself, is what traps borrowers in place.
If a borrower is upside down by $1,000 on a 30% loan, they can sell the vehicle and cover the shortfall with a few paychecks. If a borrower is upside down by $10,000, they need a bridge loan. A credit union personal loan in the $10,000 range would carry an interest rate in the high single digits to mid-teens for someone with a 650-660 credit score. Any rate below 30% saves money on the first day. A 12% loan on $10,000 is a vastly less expensive loan, even if it’s still not a good one.
Pair that with selling the motorcycle and four-wheelers, worth about $7,000, and the bridge loan shrinks. The 1993 diesel truck becomes the daily driver. The 30% loan disappears.
What to do if you are sitting in a similar loan Get the payoff quote in writing. Call the lender and request the 10-day payoff figure, not the balance shown on the statement. Get two independent resale appraisals. Use CarMax (NYSE:KMX | KMX Price Prediction) and Carvana (NYSE:CVNA) for instant offers, then check a local dealer. The highest of the three is your realistic sale price. Calculate the gap. Payoff minus sale price equals the bridge you need to cover. That number, not the monthly payment, is your real problem. Shop credit unions, not banks or buy-here-pay-here lots. Local credit unions routinely write unsecured personal loans for members with mid-600s credit. Any rate under 20% is a win against a 30% auto loan. Liquidate non-essential vehicles and toys before touching retirement or emergency cash. A motorcycle sold this weekend is worth more than one sold in six months after another insurance and registration cycle. Kamel closed the call with the line that should anchor any young borrower’s thinking: “A 21-year-old who is a licensed welder and heavy machine operator that has no debt, you know what you can do? Anything you want. You’re one of the freest men on the planet.” The math agrees with him. A 30% loan amounts to a wage garnishment with a steering wheel attached.
RICHMOND, Va.--(BUSINESS WIRE)--CarMax, Inc. (NYSE:KMX) will report its financial results for the first quarter ended May 31, 2026 before the market opens on June 17, 2026, and it will host a conference call with investors at 8:00 a.m. ET to discuss these results. Please note that the Company has changed the time of its earnings conference calls to 8:00 a.m. ET.
Participants on the call will include Keith Barr, President and CEO, Enrique Mayor-Mora, Executive Vice President, CFO and Jon Daniels, Executive Vice President, CarMax Auto Finance. The live conference call can be accessed by dialing (800) 225-9448 (or (203) 518-9708 for international access) and entering the conference ID 3171396. A live audio webcast also will be available at investors.carmax.com.
A replay of the webcast will be available on the company’s website at investors.carmax.com through September 28, 2026 or via telephone (for approximately one week) by dialing (800) 839-1247 (or (402) 220-0470 for international access).
June 23, 2026 – CarMax Annual Meeting of Shareholders
The CarMax 2026 annual meeting of shareholders will be held on Tuesday, June 23, 2026 beginning at 1:00 p.m. ET. The meeting will be held virtually and there will be no in-person meeting location. A live webcast of the meeting will be available at investors.carmax.com and a webcast replay will be available following the event.
About CarMax
CarMax, the nation’s largest retailer of used autos, revolutionized the automotive retail industry by driving integrity, honesty and transparency in every interaction. The company offers a truly personalized experience with the option for customers to do as much, or as little, online and in-store as they want. During the fiscal year ended February 28, 2026, CarMax sold approximately 780,000 used vehicles and 540,000 wholesale vehicles at its auctions. In addition, CarMax Auto Finance originated $8 billion in auto loans during fiscal 2026, adding to its nearly $16 billion portfolio. CarMax has more than 255 store locations, approximately 28,000 associates, and is proud to have been recognized for 22 consecutive years as one of the Fortune 100 Best Companies to Work For®. CarMax is committed to helping its communities thrive and reducing the environmental footprint of its operations. Learn more in the 2026 Responsibility Report. For more information, visit www.carmax.com.
