CarMax (NYSE:KMX) Shares Gap Down Following Analyst Downgrade

CarMax, Inc. (NYSE:KMX) shares gapped down before the market opened on Thursday after JPMorgan Chase & Co. downgraded the stock from a neutral rating to an underweight rating. The stock had previously closed at $40.81, but opened at $36.08. JPMorgan Chase & Co. now has a $30.00 price target on the stock. CarMax shares last traded at $35.34, with a volume of 6,447,070 shares trading hands.

KMX has been the topic of a number of other research reports. Needham & Company LLC reduced their price objective on CarMax from $92.00 to $60.00 and set a “buy” rating on the stock in a research note on Friday, September 26th. William Blair downgraded CarMax from an “outperform” rating to a “market perform” rating in a research note on Thursday. Seaport Res Ptn downgraded CarMax from a “strong-buy” rating to a “hold” rating in a research note on Sunday, September 28th. Zacks Research downgraded CarMax from a “hold” rating to a “strong sell” rating in a research note on Thursday, October 2nd. Finally, Evercore ISI reaffirmed an “in-line” rating and issued a $52.00 price objective (down previously from $80.00) on shares of CarMax in a research note on Friday, September 26th. One research analyst has rated the stock with a Strong Buy rating, four have given a Buy rating, nine have given a Hold rating and four have assigned a Sell rating to the stock. Based on data from MarketBeat, the stock has an average rating of “Hold” and a consensus target price of $50.08.

Hedge Funds Weigh In On CarMax

Institutional investors and hedge funds have recently modified their holdings of the stock. Y Intercept Hong Kong Ltd purchased a new position in CarMax during the 2nd quarter valued at $5,758,000. Hantz Financial Services Inc. boosted its holdings in CarMax by 45.3% during the 2nd quarter. Hantz Financial Services Inc. now owns 191,827 shares of the company’s stock valued at $12,893,000 after acquiring an additional 59,840 shares during the period. Avior Wealth Management LLC boosted its holdings in CarMax by 6,129.3% during the 2nd quarter. Avior Wealth Management LLC now owns 9,344 shares of the company’s stock valued at $628,000 after acquiring an additional 9,194 shares during the period. Gagnon Securities LLC boosted its holdings in CarMax by 3.9% during the 2nd quarter. Gagnon Securities LLC now owns 163,417 shares of the company’s stock valued at $10,983,000 after acquiring an additional 6,067 shares during the period. Finally, AlphaQuest LLC boosted its holdings in CarMax by 461.3% during the 2nd quarter. AlphaQuest LLC now owns 7,174 shares of the company’s stock valued at $482,000 after acquiring an additional 5,896 shares during the period.

CarMax Trading Down 15.3%

The stock has a fifty day moving average of $50.37 and a 200-day moving average of $59.07. The company has a debt-to-equity ratio of 2.87, a quick ratio of 1.06 and a current ratio of 2.46. The company has a market cap of $5.07 billion, a PE ratio of 10.16, a PEG ratio of 0.81 and a beta of 1.26.

CarMax (NYSE:KMX) last posted its quarterly earnings data on Thursday, September 25th. The company reported $0.64 earnings per share (EPS) for the quarter, missing analysts’ consensus estimates of $1.03 by ($0.39). CarMax had a net margin of 1.98% and a return on equity of 8.51%. The business had revenue of $6.59 billion for the quarter, compared to analysts’ expectations of $7.07 billion. During the same quarter in the previous year, the firm earned $0.85 EPS. CarMax’s revenue was down 6.0% compared to the same quarter last year. Sell-side analysts anticipate that CarMax, Inc. will post 3.23 EPS for the current fiscal year.

CarMax Company Profile

CarMax, Inc, through its subsidiaries, operates as a retailer of used vehicles and related products in the United States. It operates in two segments: CarMax Sales Operations and CarMax Auto Finance. The CarMax Sales Operations segment offers customers a range of makes and models of used vehicles, including domestic, imported, and luxury vehicles, as well as hybrid and electric vehicles; used vehicle auctions; extended protection plans to customers at the time of sale; and reconditioning and vehicle repair services.