The company did not offer guidance, but consensus fourth-quarter estimates call for EPS of $0.58 on revenues of $3.46 billion. For the full year, consensus estimates call for EPS of $2.52 on revenues of $14.11 billion.
The percentage of retail vehicles financed by subprime loans offered by third-parties and CarMax dropped from 17.7% a year ago to 15.2% this year. Sequentially, however, the percentage of subprime loans rose from 13.8%.
The company’s CEO said:
Continued strong performance in our used, wholesale and [CarMax Auto Finance] operations, along with the growth of our store base and our ongoing share repurchase program contributed to our record third quarter earnings per share.
ALSO READ: America’s 50 Best Cities to Live In
Same-store sales of used vehicles rose 7.4% year-over-year in the third quarter. The company attributed the substantial increase to growth in customer traffic and improved conversion. Total used vehicle sales rose 14% year-over-year.
The company’s auto finance group posted a profit gain of about 6.9% year-over-year. CarMax is also continuing its tests of originating loans for subprime borrowers that the company would typically direct to third-party, subprime lenders for financing. As of the end of November, the company has $56.7 million outstanding in the program, about 21% of which represents loans made in the third quarter.
According to data from the National Automobile Dealers Association (NADA), used car prices were 1.1% higher at the end of November than they were at the end of November 2013, led by a jump of 9.6% in used pickup truck prices.
CarMax shares are up about 9.5% in premarket trading Friday to $66.29, which would be a new 52-week high if it holds. The current 52-week range is $42.54 to $60.66. Thomson Reuters had a consensus analyst price target of around $57.40 before the results were announced.
ALSO READ: 9 Big Stocks That Doubled in 2014
The #1 Thing to Do Before You Claim Social Security (Sponsor)
Choosing the right (or wrong) time to claim Social Security can dramatically change your retirement. So, before making one of the biggest decisions of your financial life, it’s a smart idea to get an extra set of eyes on your complete financial situation.
A financial advisor can help you decide the right Social Security option for you and your family. Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you.
Click here to match with up to 3 financial pros who would be excited to help you optimize your Social Security outcomes.
Have questions about retirement or personal finance? Email us at [email protected]!
By emailing your questions to 24/7 Wall St., you agree to have them published anonymously on a673b.bigscoots-temp.com.
By submitting your story, you understand and agree that we may use your story, or versions of it, in all media and platforms, including via third parties.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
