CarMax (KMX, $92.45) reports fiscal Q1 earnings' pandemic plunge
On Friday, CarMax reported fiscal first-quarter earnings that saw a steep plunge from the year-ago period, on shutdown due to the covid-19 crisis.
The retail used-cars company’ net earnings fell to $5 million, or 3 cents a share, from $266.7 million, or $1.59 a share in the year-ago period.
The EPS was also lower than the 4 cents expected by analysts polled by FactSet.
Sales declined -40% year-over-year to $3.23 billion, compared to analysts’ expectation of $2.7 billion. Comparable-store used unit sales dropped -42% during the quarter.
The overall result also included a $122 million in loan-loss provisions for CarMax’s financing unit. Revenue in its financing business fell to $51 million from $116 million.
CarMax CEO Bill Nash said, “We accomplished a lot this quarter, despite the challenges the pandemic posed,” Nash noted that more than 80% of the days in the quarter “were negatively impacted by a mix of store closures and limited operations.”
However, Nash feels sanguine about the sales and customer foot traffic in late May and into June, particularly among used-car sales, and online.
Tickeron's AI-powered scorecard rates CarMax a STRONG BUY.
KMX enters an Uptrend as Momentum Indicator exceeded the 0 level on June 12, 2020
This indicator signals that KMX's price has momentum to move higher, since its current price moved above its price 14 days ago. Traders may consider buying the ticker or exploring call options. In 50 of 76 cases where KMX's Momentum Indicator exceeded 0, its price rose further within the subsequent month. The odds of a continued Uptrend are 66%
Current price $92.45 crossed the support line at $93.17 and is trading between $93.17 support and $88.79 support lines. Throughout the month of 05/18/20 - 06/18/20, the price experienced a +23% Uptrend. During the week of 06/11/20 - 06/18/20, the stock enjoyed a +12% Uptrend growth.
Technical Analysis (Indicators)
Bullish Trend Analysis
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where KMX advanced for three days, in 190 of 307 cases, the price rose further within the following month. The odds of a continued Uptrend are 62%.
The Aroon Indicator entered an Uptrend today. In 169 of 268 similar cases where KMX Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are 63%.
Bearish Trend Analysis
The RSI Indicator appears to be shifting from an Uptrend to a Downtrend. In 22 of 38 cases where KMX's RSI indicator exited the overbought zone, the price fell further within the following month. The odds of a continued Downtrend are 58%.
The Stochastic Indicator has been in the overbought zone for 1 day. Expect a price pull-back in the near future.
The Moving Average Convergence Divergence (MACD) crossed below the signal line. In 26 of 41 cases where KMX's MACD histogram became negative, the price fell further within the following month. The odds of a continued Downtrend are 63%.
The higher Bollinger Band was broken -- a price fall is expected as the ticker heads toward the middle band, which invites the trader to consider selling or shorting the ticker, or exploring put options. In 20 of 40 cases where KMX's price broke its higher Bollinger Band, its price dropped further during the following month. The odds of a continued Downtrend are 50%.
Fundamental Analysis (Ratings)
Tickeron has a positive outlook on this ticker and predicts a further increase by more than 4.00% within the next month with a likelihood of 58%. During the last month, the daily ratio of advancing to declining volumes was 1.56 to 1.
The Tickeron Price Growth Rating for this company is 2 (best 1 - 100 worst), indicating outstanding price growth. KMX’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron PE Growth Rating for this company is 39 (best 1 - 100 worst), pointing to consistent earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron SMR rating for this company is 51 (best 1 - 100 worst), indicating slightly weaker than average sales and a marginally profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Profit vs. Risk Rating rating for this company is 56 (best 1 - 100 worst), indicating well-balanced risk and returns. The average Profit vs. Risk Rating rating for the industry is 82, placing this stock slightly better than average.
The Tickeron Valuation Rating of 70 (best 1 - 100 worst) indicates that the company is slightly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (4.24) is normal, around the industry mean (13.77). P/E Ratio (18.39) is within average values for comparable stocks, (49.38). Projected Growth (PEG Ratio) (1.41) is also within normal values, averaging (16.00). Dividend Yield (0.00) settles around the average of (1.23) among similar stocks. P/S Ratio (0.71) is also within normal values, averaging (0.61).
KMX's Stochastic Oscillator is remaining in oversold zone for 11 days
The price of this ticker is presumed to bounce back soon, since the longer the ticker stays in the oversold zone, the more promptly an uptrend is expected.
Technical Analysis (Indicators)
Bullish Trend Analysis
The RSI Indicator shows that the ticker has stayed in the oversold zone for 4 days. The price of this ticker is presumed to bounce back soon, since the longer the ticker stays in the oversold zone, the more promptly an Uptrend is expected.
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where KMX advanced for three days, in of 323 cases, the price rose further within the following month. The odds of a continued upward trend are .
KMX may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options.
The Aroon Indicator entered an Uptrend today. In of 266 cases where KMX Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are .
Bearish Trend Analysis
The Momentum Indicator moved below the 0 level on February 21, 2025. You may want to consider selling the stock, shorting the stock, or exploring put options on KMX as a result. In of 88 cases where the Momentum Indicator fell below 0, the stock fell further within the subsequent month. The odds of a continued downward trend are .
The Moving Average Convergence Divergence Histogram (MACD) for KMX turned negative on February 21, 2025. This could be a sign that the stock is set to turn lower in the coming weeks. Traders may want to sell the stock or buy put options. Tickeron's A.I.dvisor looked at 44 similar instances when the indicator turned negative. In of the 44 cases the stock turned lower in the days that followed. This puts the odds of success at .
KMX moved below its 50-day moving average on February 21, 2025 date and that indicates a change from an upward trend to a downward trend.
The 10-day moving average for KMX crossed bearishly below the 50-day moving average on March 04, 2025. This indicates that the trend has shifted lower and could be considered a sell signal. In of 16 past instances when the 10-day crossed below the 50-day, the stock continued to move higher over the following month. The odds of a continued downward trend are .
Following a 3-day decline, the stock is projected to fall further. Considering past instances where KMX declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to consistent earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating steady price growth. KMX’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is slightly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (2.245) is normal, around the industry mean (12.561). P/E Ratio (27.457) is within average values for comparable stocks, (36.882). Projected Growth (PEG Ratio) (1.093) is also within normal values, averaging (2.650). KMX has a moderately low Dividend Yield (0.000) as compared to the industry average of (0.034). P/S Ratio (0.512) is also within normal values, averaging (19.514).
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating weak sales and an unprofitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating that the returns do not compensate for the risks. KMX’s unstable profits reported over time resulted in significant Drawdowns within these last five years. A stable profit reduces stock drawdown and volatility. The average Profit vs. Risk Rating rating for the industry is 77, placing this stock worse than average.
Notable companies
Industry description
Market Cap
High and low price notable news
Volume
Fundamental Analysis Ratings
The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows
General Information
a holding company whose subsidiaries sell and finance used motor vehicles
Industry SpecialtyStores