DailyIQ
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Sector:Consumer CyclicalAll sectors
Last updated 7 minutes ago

KMX·CarMax, Inc.

$.
+. (+.%)
After Hours
High
$54.25
Open
$51.55
Market Cap
7.59B
52W High
$67.53
Low
$51.38
P. Close
$53.49
P/E
34.11
52W Low
$30.26
Fwd P/E
17.63
DailyIQ Est.
$45.27
Technical Score (1D)
91
BUY
News Sentiment
67
BULLISH
CarMax’s June earnings report showed a revenue and EPS beat despite a 12 % decline in GAAP net income, indicating stronger top‑line performance that has already lifted investor sentiment. Analysts responded by raising price targets and upgrading the stock, which signals expectations of better earnings in the coming quarters. A sizable insider purchase of $502 k in shares further reinforces management’s confidence and may sustain bullish sentiment. The company’s short‑term growth strategy—accepting lower profits to expand inventory and marketing—has already compressed margins, a factor that could dampen near‑term earnings. Q1 FY2027 revenue rose 6.2 % YoY and unit volume up 3.3 %, supporting the demand‑growth narrative, but EPS fell to $1.31 because of margin pressure. The Q2 earnings beat was tempered by rising operating costs and potential supply‑chain bottlenecks, warning that gross margin could erode. These developments suggest that while top‑line growth is solid, cost pressures may offset upside, making the next 1–10 trading days a mixed‑signal period. Traders should watch the upcoming earnings release for updated revenue guidance and inventory turnover data to confirm the new price target. Additionally, monitoring inventory levels and logistics cost trends will be key to gauge whether the growth strategy translates into sustainable profitability.
Earnings Summary
CarMax operates as a leading used vehicle retailer in the United States, offering a comprehensive car‑buying experience through its Sales Operations and Auto Finance segments, and competes within the broader auto & truck dealership sector. In the most recent two quarters, Q4 2026 and Q1 2027, the company posted revenue of $5.95 billion and $8.01 billion respectively, reflecting a 2.6% increase from Q4 2025 to Q4 2026 and a 34.8% jump to Q1 2027; EPS rose from $0.34 to $1.31, a 205% rise, with each quarter beating analyst estimates (Q4 2026 EPS beat $0.21167, Q1 2027 EPS beat $0.70). Compared to the prior two quarters (Q3 2026 and Q4 2025), revenue remained flat from Q4 2025 to Q3 2026, then accelerated in Q4 2026, while EPS held steady at $0.43 in Q3 2026 and Q4 2025 before declining to $0.34 in Q4 2026 and surging to $1.31 in Q1 2027, illustrating a pattern of consistent earnings beats across the period. Historically, CarMax has shown a strong YoY revenue trajectory, with a 38% increase from Q4 2025 to Q1 2027, and EPS growth exceeding 200% over the same span, underscoring a trend of beating expectations even as the company navigates inventory and cost dynamics. Recent news highlights the Q1 2027 earnings release, which reported a net income of $185.6 million and revenue of $8.01 billion, both surpassing forecasts, and notes that cost controls and inventory turnover are sustaining profitability amid competitive pressures from rivals such as Carvana; the company’s upcoming Q2 earnings release is expected to focus on modest revenue growth, higher acquisition costs, and margin impacts, with investors watching inventory management and pricing strategy for clues on future performance. Investors should watch for commentary on inventory levels, pricing adjustments, and cost‑control initiatives in the next earnings call, as well as any discussion of macro factors like interest rates and consumer credit conditions that could influence vehicle financing demand and overall market demand for used vehicles.

EPS

EstBeatMiss
$0.02$0.38$0.75$1.11$1.48Q3'25Q4'25Q3'26Q4'26Q1'27
QtrEstActual+/−
Q1'27$0.70$1.31+87.1%
Q4'26$0.21$0.34+60.6%
Q3'26$0.19$0.43+131.6%
Q4'25$0.32$0.43+36.1%
Q3'25$1.04$0.64-38.6%

Revenue

EstBeatMiss
$5.3B$6.1B$6.8B$7.6B$8.4BQ3'25Q4'25Q3'26Q4'26Q1'27
QtrEstActual+/−
Q1'27$7.5B$8.0B+6.9%
Q4'26$5.7B$5.9B+3.8%
Q3'26$5.6B$5.8B+2.7%
Q4'25 - $5.8B -
Q3'25 - $6.6B -
Full Earnings BreakdownEstimates, actuals, guidance, and historical context
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Market Data

KMX Stock Snapshot

KMX is currently trading at $53.49, giving CarMax, Inc. a market cap of 7.59B and a P/E ratio of 34.1. Today's range spans $51.38–$54.25, with shares opening at $51.55 and moving up $0.00 (0.0%) from the prior close. DailyIQ's technical score sits at 91/100 (BUY) with a news sentiment reading of 67/100.

Over the past year KMX has traded between $30.26 and $67.53 - the current price is +76.8% off the 52-week low and -20.8% from the high. 28 analysts cover the stock with a Hold consensus and a mean 12-month target of $51.31 (range $33.00–$96.00), implying downside of -4.1%.

KMX is surfing the Consumer Cyclical sector momentum as a small-cap (7.59B market cap) - and the numbers back it up. Technical score: 91/100 (BUY). Sentiment: bullish (67/100). Price: $53.49 (in the middle of its 52-week range). The current P/E ratio stands at 34.1. In smaller-cap names, sector momentum tends to amplify company-specific signals - which makes the bullish read here more valuable than the same signal would be in a mega-cap peer. Annual range: $30.26–$67.53.

The combination of a BUY technical signal (91/100) and bullish news sentiment (67/100) in a small-cap like KMX (7.59B, Consumer Cyclical) creates the kind of setup that shows up in small-cap momentum screens used by growth-oriented funds. At $53.49 (in the middle of its 52-week range in $30.26–$67.53), the stock is not yet crowded — which means the entry risk-reward is better than it will be if the technical and sentiment setup persists and attracts wider institutional attention.