CarMax, Inc.
- Open
- 50.67
- Day high
- 51.50
- Day low
- 50.10
- Prev close
- 50.30
- Volume
- 1.5M
- Mkt cap
- $7.2B
- P/E (TTM)
- 31.7
- EPS (TTM)
- $1.61
- P/B
- 1.2
- P/S
- 0.3
- Yield
- —
- Per share
- —
- ▲Insiders net buying $1.0M over the last 3 months (5 open-market buys, 0 sales)
- ◆Cluster buying — multiple insiders bought within days
- 🏛Institutions reducing (13F)
CarMax, Inc. (KMX) is a Consumer Cyclical company listed on NYSE. The stock is down 24% over the past year. Over the trailing 3 months, insiders filed 5 open-market buys and 0 sales (SEC Form 4). Drillr has 16 published research articles covering KMX.
CarMax, Inc. (KMX) financials & analyst ratings
Fundamentals (TTM)
Analyst consensus · 10 analysts
Source: exchange market data + company filings. Figures are trailing-twelve-month or as most recently reported. For informational purposes only — not investment advice.
KMX earnings date, history & EPS estimates
| Report date | EPS est | EPS actual | Surprise | Revenue | Rev. surprise |
|---|---|---|---|---|---|
| Jun 17, 2026 | $0.96 | $1.31 | +35.8% | $8.0B | +7.9% |
| Dec 18, 2025 | $0.31 | $0.51 | +66.4% | $6.2B | +10.6% |
| Sep 25, 2025 | $1.04 | $0.64 | -38.5% | $7.1B | +1.1% |
| Jun 20, 2025 | $1.16 | $1.38 | +19.0% | $7.5B | +0.6% |
| Dec 19, 2024 | $0.59 | $0.81 | +37.3% | $6.2B | +2.9% |
| Sep 26, 2024 | $0.86 | $0.85 | -1.2% | $7.0B | +2.7% |
| Jun 21, 2024 | $0.96 | $0.97 | +1.0% | $7.1B | -0.7% |
| Dec 21, 2023 | $0.43 | $0.52 | +20.9% | $6.1B | +4.9% |
| Jun 23, 2023 | $0.79 | $1.16 | +46.8% | $7.7B | +9.5% |
| Dec 22, 2022 | $0.70 | $0.24 | -65.7% | $6.5B | -9.1% |
| Jun 24, 2022 | $1.49 | $1.56 | +4.7% | $9.3B | +2.8% |
| Dec 22, 2021 | $1.44 | $1.63 | +13.2% | $8.5B | +8.9% |
KMX insider trading activity (SEC Form 4)
| Date | Insider | Type | Shares | Price |
|---|---|---|---|---|
| Jun 29, 2026 | Satriano Pietrodirector | Grant | 3,696 | — |
| Jun 29, 2026 | OShaughnessy Robertdirector | Grant | 3,696 | — |
| Jun 29, 2026 | Shinder Marcelladirector | Grant | 3,696 | — |
| Jun 29, 2026 | ONeil Mark Fdirector | Grant | 3,696 | — |
| Jun 29, 2026 | COBB WILLIAM Cdirector | Grant | 3,696 | — |
| Jun 29, 2026 | Chawla Sonadirector | Grant | 3,696 | — |
| Jun 29, 2026 | FOLLIARD THOMAS Jdirector | Grant | 3,696 | — |
| Jun 29, 2026 | Bensen Peter Jdirector | Grant | 3,696 | — |
| Jun 29, 2026 | McCreight David W.director | Grant | 3,696 | — |
| Jun 29, 2026 | KESSLER JAMES FRANCISdirector | Grant | 3,696 | — |
| Jun 26, 2026 | Shinder Marcelladirector | Buy | 574 | $52.01 |
| Jun 26, 2026 | ONeil Mark Fdirector | Buy | 4,800 | $52.36 |
| Jun 26, 2026 | Chawla Sonadirector | Buy | 2,000 | $53.39 |
| Jun 24, 2026 | Barr Keithdirector, officer: President and CEO | Buy | 9,400 | $53.01 |
| Jun 24, 2026 | FOLLIARD THOMAS Jdirector | Option | 14,855 | $51.91 |
Source: KMX SEC Form 4 filings, latest Jun 29, 2026. For informational purposes only — not investment advice.
See the full KMX insider & 13F page →KMX research & analysis
CarMax Proxy Fight: Starboard's Shareholder Math and the Case for Operational Urgency
Starboard Value's proxy contest at CarMax targets a company whose operating income has nearly halved from its FY22 peak, ROIC stands at just 3.1%, and shares have fallen 41.6% over the past year. The activist's shareholder math depends on convincing institutional voters that the incumbent board's oversight of $1.4B in buybacks during margin deterioration and a compressed 2.5% EBIT margin constitutes a governance failure warranting new directors.
CarMax's $150M Cost-Out Program: Progress Scorecard and What Remains to Execute by FY2027
CarMax is executing a $150M annualized SG&A cost-out program against a ~$2.5B baseline, targeting an exit run rate reduction by fiscal year-end 2027 (February 2027). With roughly eleven months remaining, progress is on track: a 30% CEC workforce reduction in Q3 FY2026 and AI-enabled productivity gains (Sky) have delivered measurable SG&A leverage, but $40–60M in additional annualized savings must still be locked in through field-level cost actions and further automation. Full execution could add approximately $0.75–$0.80 in EPS, though the re-rating thesis requires volume recovery alongside cost discipline.
Starboard vs. CarMax: Why the Proxy Fight's Timing Collision with New CEO Keith Barr Matters
Starboard Value has nominated two directors at CarMax's 2026 annual meeting, creating a rare proxy fight where both sides endorse incoming CEO Keith Barr. With KMX shares down 41% over the past year, Q3 net income halved to $62.2 million, and securities investigations underway, the contest centers on board oversight intensity rather than strategic direction — making the timing collision with Barr's March 16 start date a pivotal governance moment.
CarMax's New CEO Inherits a $6B Market Cap and a 2.5% Operating Margin — Here's What Has to Change
CarMax's incoming CEO Keith Barr inherits a business generating $28 billion in revenue but only a 2.5% operating margin, with the stock down 41% over the past year and activist investor Starboard Value pushing for board changes. The key priorities are SG&A restructuring beyond the current $150M target, resolving the volume-versus-margin tradeoff in a difficult pricing environment, and establishing a capital allocation framework that satisfies both the board and activist shareholders.
Which KMX cost lines are most vulnerable to cuts — and where does cutting risk the customer experience?
CarMax's $150M SG&A savings target will draw primarily from compensation (~$80-100M via AI-driven CEC workforce cuts) and other overhead (~$30-50M via IT and admin rationalization), while advertising and occupancy offer limited room. The CEC restructuring carries moderate customer experience risk as AI replaces human interactions, with early NPS data encouraging but management acknowledging gaps in the digital selling experience.
Is CarMax's $150M SG&A target enough to close the margin gap with AutoNation and Lithia?
CarMax's $150M SG&A savings target would close the overhead efficiency gap with franchised peers like AutoNation and Lithia on a gross-profit-absorption basis, but would only narrow the operating margin gap by about one-third. The remaining shortfall stems from CarMax's structurally lower gross margins inherent to its pure used-car model.
ANLADGPIWhat must Keith Barr signal on his first KMX earnings call to prevent Starboard from gaining shareholder support?
Keith Barr's first CarMax earnings call in April 2026 is a proxy fight inflection point. With Starboard Value nominating two board directors and Q3 FY2026 EPS down 47% year-over-year to $0.43, Barr must deliver specific margin recovery targets, a credible digital strategy to close the 10x market cap gap with Carvana, and a disciplined capital allocation framework — or risk handing Starboard the shareholder mandate for board-level change.
CVNAWill CarMax's new CEO accelerate share buybacks given the stock is down 41% in 12 months?
CarMax has aggressively accelerated share buybacks from $94M in FY2024 to $589M through three quarters of FY2026, while the stock trades near book value at $42.50 after a 41% decline. With $1.74 billion in remaining authorization and strong free cash flow, the incoming permanent CEO will face a compelling valuation case for further acceleration, though elevated debt levels and operational turnaround needs may temper the pace.
ANLADCan Starboard squeeze meaningful margin from CarMax's 2.5% EBIT margin without disrupting the omnichannel pivot?
Starboard Value has nominated two directors to CarMax's board, targeting the company's 2.5% EBIT margin that trails peers AutoNation (4.5%) and Lithia (4.1%) by 160-200 basis points. The activist's cost-cutting playbook faces a core tension: CarMax's $150M SG&A savings initiative may not close the margin gap, but deeper cuts risk undermining the omnichannel platform that differentiates the company from both franchise dealers and Carvana.
CVNAANLADHow does Starboard's KMX campaign compare to past activist wins in auto retail like Carvana and Lithia?
Starboard Value's proxy fight at CarMax targets a company with 2.5% EBIT margins and -41% one-year stock returns, significantly trailing peers Carvana (9.3% EBIT margin), Lithia Motors (4.1%), and Group 1 Automotive (4.2%). While Carvana's turnaround from near-bankruptcy shows dramatic margin improvement is possible in auto retail, CarMax's $19.4B debt load and declining quarterly earnings present a more complex challenge for activist-driven transformation.
CVNALADGPIWhat Does $150M in KMX SG&A Exits Imply for Headcount, Technology Spend, and Store Footprint?
CarMax's $150M+ SG&A exit rate target by end of FY2027 implies roughly 1,200–1,800 headcount reductions (4–6% of workforce), $15–22M in technology rationalization, and $15–30M in store/reconditioning footprint optimization—with EPS accretion of approximately $0.79 if achieved on schedule. At 13.8x TTM earnings and ~10.5x implied FY2027 earnings, the stock is pricing in partial but not full execution of the cost program. The key risk is whether workforce reductions impair reconditioning throughput and inventory turn.
Is CarMax's $150M SG&A Savings Target Achievable Without Sacrificing the Omnichannel Investment Thesis?
CarMax's $150M+ SG&A savings target by FY2027 exit rate faces a credibility challenge: SG&A rose $149M year-over-year in FY2025 to $2.44B, even as revenue held flat at $28.2B. Sequential improvement in FY2026 quarterly SG&A is encouraging, but achieving the target without cutting technology investment—the foundation of CarMax's omnichannel differentiation against Carvana—requires operational efficiency gains that the company has yet to demonstrate at scale.
CVNAVROOMCan Keith Barr's First Strategic Roadmap Reverse CarMax's Three-Year GPU Compression?
CarMax's Q4 FY2026 earnings call in April will mark new CEO Keith Barr's first public strategic roadmap, arriving after three years of severe GPU compression that cut diluted EPS from $6.97 to $3.21 and sent the stock down 42% over the past year. The key questions are whether Barr validates the $150M SG&A savings target, commits to a GPU reset floor, and frames a multi-year earnings recovery algorithm that can close the widening gap with Carvana.
CVNAWhich Digital Retail and Financing Investments Will Keith Barr Prioritize to Close the Gap with Carvana?
CarMax faces a widening competitive gap with Carvana, with a 9-percentage-point gross margin deficit (11.3% vs. 20.2%), flat revenue growth versus Carvana's 49% surge, and a market cap gap of $60 billion. Incoming CEO Keith Barr's Q4 FY2026 strategic roadmap must prioritize end-to-end digital transactions, AI-driven inventory pricing, and CarMax Auto Finance digital modernization to deliver a credible margin expansion thesis and close the valuation discount.
CVNAALLYIf Starboard Wins Board Seats at CarMax, Which Operational Levers Gets Pulled First?
Starboard Value's proxy contest at CarMax targets a business where operating margins have compressed from 4.7% to 2.8%, ROIC sits at just 3.1% versus peers at 7-10%, and SG&A has ballooned to 8.6% of revenue. If Starboard wins board seats, the most immediate operational levers are SG&A reduction (estimated $300M+ opportunity), inventory velocity improvement, CarMax Auto Finance balance-sheet optimization, and potential store footprint rationalization. The peer comparison to AutoNation and Lithia Motors provides a clear benchmark for what disciplined capital allocation and cost control can achieve.
ANLADDoes CarMax's Board Composition Change Meaningfully Alter the Odds of a Strategic Sale or Breakup?
Starboard Value's proxy campaign at CarMax targets board seats that could catalyze a formal strategic review, most plausibly a separation of CarMax Auto Finance from retail operations rather than a full company sale. While board composition change is a necessary precondition for strategic action, minority representation alone does not guarantee a transaction given CarMax's $19.4B debt load and the structural complexity of its captive lending business. The most credible value-unlock path is a CAF spinoff that lets each segment trade at appropriate multiples.
CVNAACV
CarMax, Inc. company profile
Overview
CarMax, Inc. (NYSE:KMX) is the largest retailer of used vehicles in the United States, founded in 1993 and headquartered in Richmond, Virginia. The company went public in 1997 and has grown from a single location to operating approximately 230 used car stores nationwide. CarMax revolutionized the used car industry by introducing a no-haggle pricing model, standardized vehicle quality standards, and comprehensive customer service approach that eliminated many traditional pain points associated with buying used cars.
Business
CarMax operates in the used automotive retail industry, which serves as an intermediary between consumers looking to sell their vehicles and those seeking to purchase pre-owned cars. The company's core business revolves around buying, reconditioning, and selling used vehicles through both retail and wholesale channels. The company operates through two primary business segments. CarMax Sales Operations represents the majority of revenue (approximately 85-90%) and encompasses the retail sale of used vehicles directly to consumers, wholesale auctions of vehicles that don't meet retail standards, and extended protection plans. CarMax Auto Finance (CAF) contributes roughly 10-15% of total revenue and provides financing solutions to retail customers across various credit spectrums. CarMax's retail operations focus on vehicles that are typically less than 10 years old with under 100,000 miles, offering a curated selection of domestic, imported, luxury, hybrid, and electric vehicles. The company's omnichannel approach allows customers to research, finance, and purchase vehicles through multiple touchpoints - online, in-store, or through a combination of both channels. Vehicles that don't meet CarMax's retail quality standards are sold through wholesale auctions to independent dealers and other automotive retailers. The company also provides reconditioning and repair services, transforming acquired vehicles to meet CarMax's standardized quality requirements before retail sale. Additionally, CarMax offers extended protection plans and various automotive services to enhance the customer experience and generate additional revenue streams.
Revenue model
CarMax generates revenue through multiple complementary business models. The primary revenue driver is vehicle sales, where the company purchases used cars from consumers and dealers, reconditions them, and sells them at retail prices with fixed gross profit margins averaging around $2,300 per vehicle. The company also operates wholesale auctions for vehicles that don't meet retail standards, typically generating lower per-unit profits of approximately $1,000-$1,100. CarMax Auto Finance serves as a significant profit center, providing loans to retail customers and earning net interest income. CAF currently penetrates about 42% of retail sales and generates income through the spread between funding costs and customer loan rates. The company has been expanding its lending capabilities to serve customers across broader credit spectrums, including subprime and near-prime borrowers. Additional revenue streams include extended protection plans sold at the time of vehicle purchase and various automotive services. The company's customers are primarily individual consumers seeking reliable transportation, with a focus on those preferring the convenience and assurance of CarMax's no-haggle, standardized approach over traditional dealership experiences. Several factors influence CarMax's margins and profitability. Favorable conditions include vehicle price stability, low interest rate environments that reduce CAF funding costs, strong consumer confidence, and efficient inventory turnover. Margin pressures arise from volatile used car pricing, rising interest rates that increase financing costs, economic downturns that reduce consumer spending on discretionary purchases, increased competition from online platforms and traditional dealers, and credit losses in the financing portfolio. The company's ability to source vehicles efficiently and maintain operational leverage through its omnichannel platform significantly impacts overall profitability.
Competitive moat
CarMax possesses a moderate but defensible competitive moat built primarily around its established brand reputation, operational scale, and integrated business model. The company's most significant advantage lies in its trusted brand and standardized customer experience, which has differentiated it in an industry historically plagued by poor customer satisfaction. CarMax's no-haggle pricing, comprehensive vehicle inspections, and return policies have created strong customer loyalty and word-of-mouth referrals. The company benefits from operational scale advantages through its nationwide network of stores, centralized reconditioning facilities, and sophisticated inventory management systems. This scale enables efficient vehicle sourcing, cost-effective reconditioning operations, and the ability to move inventory between locations to optimize sales. CarMax's integrated financing arm provides additional competitive advantages by capturing financing margins and offering seamless customer experiences. However, CarMax's moat faces increasing competitive pressures from multiple directions. Online platforms like Carvana and Vroom have challenged traditional retail models with direct-to-consumer delivery services. Traditional franchised dealers have improved their digital capabilities and customer service standards. Additionally, new market entrants including automotive manufacturers expanding into certified pre-owned programs and technology companies entering automotive retail pose long-term threats. The company's moat strength is moderate rather than exceptional because vehicle retail fundamentally remains a commodity business where price and convenience often trump brand loyalty. While CarMax has maintained market leadership, the barriers to entry in used car retail are not insurmountable, and the company must continuously invest in technology, customer experience, and operational efficiency to maintain its competitive position.
Risks & safety
CarMax demonstrates reasonable financial stability with moderate leverage but faces cyclical industry headwinds that impact cash generation. **Liquidity and Solvency:** - Cash position of $247 million as of Q4 2025, down from higher levels in previous quarters - Current ratio of 2.31 indicates adequate short-term liquidity coverage - Debt-to-equity ratio of 3.08 reflects significant leverage, primarily from auto finance operations - Free cash flow of $19 million in Q4 2025, substantially lower than historical levels **Valuation Metrics:** - Trading at 35.5x trailing P/E ratio, elevated compared to historical norms - EV/EBITDA of 36.0x suggests premium valuation relative to earnings power - Price-to-book ratio of 2.04x reflects moderate premium to tangible assets **Other Considerations:** - ROE of 1.4% in recent quarter indicates compressed profitability - Cyclical industry exposure creates earnings volatility risk - High operational leverage amplifies both upside and downside scenarios
Recent development
Over the past few years, CarMax has pursued several strategic initiatives focused on digital transformation and operational efficiency. The company has significantly expanded its omnichannel capabilities, with online sales now representing 15% of retail unit sales and omni-channel transactions accounting for 67% of total retail sales. This digital evolution includes AI-powered virtual assistants, enhanced online appraisal experiences, and customer shopping accounts that provide personalized experiences. CarMax has diversified its vehicle sourcing strategy by expanding dealer relationships through its MAX Offer program, which has driven dealer vehicle acquisitions up 114% in recent periods. The company purchased approximately 269,000 vehicles in fiscal 2025, with 223,000 from consumers and 46,000 from dealers, representing a 15% increase in total acquisitions. The company has undertaken significant cost reduction initiatives, targeting $200-250 per retail unit in operational savings through logistics optimization, reconditioning efficiency improvements, and technology investments. CarMax expects to achieve omni-cost neutrality by fiscal 2026, meaning the additional costs of omnichannel operations will be offset by operational efficiencies. CarMax Auto Finance has evolved into a full-spectrum lender, expanding beyond its traditional prime customer base to serve subprime and near-prime borrowers. The company has successfully executed non-prime asset-backed securities transactions and is targeting 100-150 basis points growth in financing penetration. This expansion represents a significant strategic shift to capture more of the financing value chain while serving customers across broader credit profiles. The company has also enhanced its electric vehicle capabilities, developing specialized EV research tools and testing dedicated EV stores to prepare for the transition to electric vehicles in the used car market.
KMX company profile · for informational purposes only — not investment advice.
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