William Blair analyst Sharon Zackfia has reiterated their bullish stance on KMX stock, giving a Buy rating on September 22.
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Sharon Zackfia’s rating is based on a combination of factors that reflect both challenges and potential opportunities for CarMax. Despite the company’s recent underperformance, including a significant drop in earnings per share and a decline in gross profit per car, Zackfia sees potential for recovery and growth. The decrease in used unit sales and the rise in SG&A expenses as a percentage of gross profit indicate operational challenges that the company is currently facing.
However, Zackfia likely believes that these issues are temporary and that CarMax has the capacity to overcome them. The increase in loan loss provisions and the resulting impact on CAF income are notable concerns, but they may also suggest that the company is taking proactive steps to manage financial risks. Overall, Zackfia’s Buy rating suggests confidence in CarMax’s ability to navigate these difficulties and improve its financial performance in the future.
Zackfia covers the Consumer Cyclical sector, focusing on stocks such as Wingstop, Lululemon Athletica, and Royal Caribbean. According to TipRanks, Zackfia has an average return of 8.9% and a 48.31% success rate on recommended stocks.
In another report released on September 22, Evercore ISI also maintained a Buy rating on the stock with a $80.00 price target.