CarMax (XA4) AI Stock Analysis

CarMax

(Frankfurt:XA4)

Rating:―N/A

Action:N/A

Date:―

No summary available

Positive Factors

Sales GrowthStrong comparable sales and vehicle-volume growth indicate improving customer demand and market-share execution. If sustained, higher throughput can support fixed-cost absorption, strengthen the retail platform, and provide a durable base for operating leverage over the next several quarters.

Negative Factors

Thin ProfitabilityVery thin net profitability and inconsistent EBIT leave limited room to absorb weaker vehicle economics or higher operating costs. This reduces the durability of earnings and makes future results more sensitive to gross-profit-per-unit pressure, cost execution, and changes in sales mix.

CarMax (XA4) vs. iShares MSCI Germany ETF (EWG)

Market Cap: EUR 8.01B
Dividend Yield: ―
Average Volume (3M): 237
Price to Earnings (P/E): 26.5
Beta (1Y): 0.39
Revenue Growth: -1.50%
EPS Growth: -42.66%
Country: Germany
Employees: 27,796
Sector: Consumer Cyclical
Sector Strength: 61
Industry: Auto - Dealerships

CarMax Business Overview & Revenue Model

Company Description

CarMax, Inc., together with its associated entities, functions as a prominent purveyor of previously owned automobiles across the United States. Its business operations are strategically structured into two principal divisions: CarMax Sales Operation...

CarMax Earnings Call Summary

Earnings Call Date:Sep 28, 2026(Q2-2027)|% Change Since:0.12%|Next Earnings Date:Dec 16, 2026

Earnings Call SentimentPositive

The call was strongly positive, with substantial year-over-year growth in sales, comparable units, EPS, gross profit, CAF income, EPP margins, and SG&A productivity. Management also highlighted improved pricing competitiveness, resilient consumers, AI and digital initiatives, strategy execution, and the planned resumption of share repurchases. The main negatives were lower gross profit per unit, declining CAF penetration, an expectation for slightly lower FY2027 CAF income, upcoming pension and severance charges, higher transportation costs, and affordability pressure from elevated interest rates. Highlights significantly outweighed the lowlights.

Positive Updates

Strong Sales Growth

Second-quarter total sales were $7.9 billion, up 19% year-over-year. Approximately 388,000 vehicles were sold across retail and wholesale channels, up 15%. Used unit comps increased 13%, total used unit sales grew 14%, and wholesale unit sales increased 16%.

Negative Updates

Used Retail Gross Profit Per Unit Declined

Used retail profit per unit was $2,105, down $111 year-over-year. Management expects FY2027 full-year retail margins to be down less than $200 per unit versus FY2026.

Company Guidance

CarMax expects FY '27 full year retail margins will be down less than the $200 per unit as compared to FY '26, with GPUs expected to be down less than $200 year-over-year for the year and to decrease in the third quarter and in the fourth quarter as well, both year-over-year; it remains on track to deliver $200 million in identified savings as an FY '27 exit rate target, drive approximately $35 per unit in incremental EPP margin for the full fiscal year, and record approximately $50 million in total settlement-related noncash, nonrecurring charges, with relatively similar amounts expected to be recognized in the third and fourth quarters; CAF's FY '27 income is anticipated to be slightly lower than FY '26 while planning to originate nearly $1 billion in Tier 2 by year-end, and share repurchases are expected to restart in the third quarter at a modest pace below the average quarterly pace prior to the pause.

CarMax Risk Analysis

CarMax disclosed 27 risk factors in its most recent earnings report. CarMax reported the most risks in the "Finance & Corporate" category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added

0 New Risks

CarMax Peers Comparison

Overall Rating

UnderperformOutperform

Sector (61)

Financial Indicators

DE:XA4 against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CVNA	72Outperform	$75.34B	23.39	43.91%	―	50.28%	157.02%
ABG	63Neutral	$3.56B	8.23	11.85%	―	-1.35%	-12.29%
Sector *	61Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
AN	58Neutral	$5.94B	8.82	31.76%	―	-1.77%	22.76%
SAH	53Neutral	$2.00B	10.06	19.94%	2.48%	2.01%	64.76%
LAD	51Neutral	$6.48B	8.87	12.12%	0.77%	1.46%	0.70%

* Consumer Cyclical Sector Average

Performance Comparison

DE:XA4 and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
DE:XA4	CarMax Inc	49.78	14.17	39.79%
ABG	Asbury Automotive	206.67	-23.76	-10.31%
AN	AutoNation Inc	185.90	-8.42	-4.33%
LAD	Driveway Vehicle Solutions	309.66	14.10	4.77%
SAH	Sonic Automotive	63.61	3.57	5.94%
CVNA	Carvana	72.00	10.04	16.21%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.

CarMax AI Stock Analysis