Cars and Drivers
CarMax Hammers Estimates as Store Traffic Leads Sales
Published:
Last Updated:
The company did not offer guidance, but consensus second-quarter estimates call for EPS of $0.65 on revenues of $3.54 billion. For the full year, consensus estimates call for EPS of $2.43 on revenues of $13.99 billion. Perhaps the post-report conference call will provide the company’s forecast for the rest of this fiscal year.
The company’s CEO said:
We had another great quarter, hitting an all-time record level of quarterly sales and earnings. The improvement was broad-based, with contributions from our retail and wholesale operations, as well as from [CarMax Auto Finance].
Same-store sales of used vehicles rose 3.4% year-over-year, which the company attributed to improvements in more customer traffic. The company’s auto finance group posted a profit gain of 8.6% year-over-year. CarMax is also continuing its tests of originating loans for subprime borrowers that the company would typically direct to third-partner lenders for financing. As of the end of May, the company has $29.6 million outstanding in the program, about two-thirds of which represents loans made in the first quarter.
Used car sales have risen even faster than new car sales. Prices for used cars were up 1.7% year-over-year in the first calendar quarter of 2014, according to Edmunds.com, and up 1.4% sequentially. Sales were down from 9.8 to 9.1 million vehicles, but weather played a large role in that drop. Days to turn in the quarter was 42, up one day year-over-year and two days sequentially.
CarMax shares were up more than 16% in premarket trading Friday, at $52.75 in a 52-week range of $42.21 to $53.08. Thomson Reuters had a consensus analyst price target of around $53.00 before the results were announced.
ALSO READ: The Most Reliable Hybrid Electric Cars
Let’s face it: If your money is just sitting in a checking account, you’re losing value every single day. With most checking accounts offering little to no interest, the cash you worked so hard to save is gradually being eroded by inflation.
However, by moving that money into a high-yield savings account, you can put your cash to work, growing steadily with little to no effort on your part. In just a few clicks, you can set up a high-yield savings account and start earning interest immediately.
There are plenty of reputable banks and online platforms that offer competitive rates, and many of them come with zero fees and no minimum balance requirements. Click here to see if you’re earning the best possible rate on your money!
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.