CarMax (NYSE:KMX) Stock Price Up 4.1% After Analyst Upgrade

Shares of CarMax, Inc. (NYSE:KMX) rose 4.1% during trading on Wednesday after Morgan Stanley raised their price target on the stock from $44.00 to $47.00. Morgan Stanley currently has a cautious rating on the stock. CarMax traded as high as $59.13 and last traded at $59.18. Approximately 3,055,626 shares were traded during trading, a decline of 1% from the average daily volume of 3,091,095 shares. The stock had previously closed at $56.84.

Other analysts also recently issued reports about the stock. Benchmark reissued a “hold” rating on shares of CarMax in a research note on Thursday, June 18th. Bank of America raised their price objective on shares of CarMax from $40.00 to $45.00 and gave the company an “underperform” rating in a research report on Wednesday, June 17th. Mizuho increased their price objective on CarMax from $38.00 to $43.00 and gave the company a “neutral” rating in a research report on Thursday, June 18th. Stephens upgraded CarMax from an “equal weight” rating to an “overweight” rating and set a $66.00 price objective for the company in a research report on Thursday, June 18th. Finally, Zacks Research downgraded shares of CarMax from a “strong-buy” rating to a “hold” rating in a research report on Wednesday, September 16th. Two investment analysts have rated the stock with a Buy rating, fourteen have assigned a Hold rating and four have given a Sell rating to the company’s stock. According to MarketBeat, CarMax presently has a consensus rating of “Reduce” and an average target price of $51.87.

Insider Activity

In related news, Director Sona Chawla acquired 2,000 shares of the company’s stock in a transaction on Thursday, June 25th. The stock was purchased at an average cost of $53.39 per share, with a total value of $106,780.00. Following the acquisition, the director directly owned 21,702 shares of the company’s stock, valued at approximately $1,158,669.78. The trade was a 10.15% increase in their ownership of the stock. The acquisition was disclosed in a legal filing with the Securities & Exchange Commission, which is available through this hyperlink. Company insiders own 1.01% of the company’s stock.

Key Stories Impacting CarMax

Here are the key news stories impacting CarMax this week:

• Positive Sentiment: CarMax’s second-quarter earnings were characterized as particularly strong among vehicle retailers, potentially supporting confidence in the company’s operating performance and turnaround efforts. Vehicle retailer Q2 earnings: CarMax simply the best
• Positive Sentiment: The company is eliminating 145 corporate positions, or roughly 4% of its corporate workforce, as part of an effort to operate more efficiently and “run leaner.” If successful, the reductions could lower expenses and improve profitability. CarMax Cuts 145 Corporate Jobs
• Neutral Sentiment: Morgan Stanley raised its CarMax price target from $44 to $47 while retaining an “equal weight” rating. The higher target reflects modestly improved expectations, but it remains below the recently cited share price, implying analysts still see limited upside. Morgan Stanley price-target update
• Neutral Sentiment: Analysts broadly maintain a cautious stance, with CarMax receiving a consensus “Reduce” rating. Separately, pre-earnings analysis said the company lacked the usual combination of factors associated with a likely earnings beat, increasing uncertainty around the report. CarMax consensus rating
• Negative Sentiment: The latest layoffs represent CarMax’s third corporate workforce reduction in approximately 11 months and are occurring amid a soft automotive market. Investors may interpret the repeated cuts as evidence of continuing demand or profitability pressure, helping explain recent weakness in the stock. Why CarMax is down after layoffs
• Negative Sentiment: Bernstein Liebhard announced an investigation into potential breaches of fiduciary duty by certain CarMax directors and officers. Although the announcement does not establish wrongdoing, it adds legal and governance risk. CarMax shareholder investigation alert

Institutional Trading of CarMax

A number of institutional investors and hedge funds have recently added to or reduced their stakes in the company. State Street Corp lifted its stake in CarMax by 5.6% in the second quarter. State Street Corp now owns 5,156,276 shares of the company’s stock valued at $272,715,000 after buying an additional 271,216 shares during the period. Anchor Investment Management LLC bought a new position in shares of CarMax in the second quarter worth $37,000. The Manufacturers Life Insurance Company grew its holdings in shares of CarMax by 0.9% during the 2nd quarter. The Manufacturers Life Insurance Company now owns 2,420,139 shares of the company’s stock valued at $128,001,000 after purchasing an additional 21,882 shares during the last quarter. Capstone Financial Advisors Inc. lifted its position in CarMax by 5.6% in the second quarter. Capstone Financial Advisors Inc. now owns 9,500 shares of the company’s stock valued at $502,000 after purchasing an additional 500 shares during the last quarter. Finally, WINTON GROUP Ltd increased its position in shares of CarMax by 181.0% in the second quarter. WINTON GROUP Ltd now owns 38,780 shares of the company’s stock valued at $2,051,000 after acquiring an additional 24,977 shares during the period.

CarMax Stock Performance

The business has a fifty day moving average of $59.58 and a 200 day moving average of $49.66. The company has a quick ratio of 0.82, a current ratio of 2.70 and a debt-to-equity ratio of 2.87. The company has a market cap of $8.30 billion, a P/E ratio of 38.63, a P/E/G ratio of 2.67 and a beta of 1.17.

CarMax Company Profile

CarMax, Inc is a specialty retailer of used vehicles and one of the largest automotive retailers in the United States. The company sells a broad selection of used cars, trucks and sport utility vehicles through its retail locations and online platform. CarMax also purchases vehicles from consumers and other sources, providing customers with a streamlined alternative to traditional private-party sales.

In addition to retail sales, CarMax operates wholesale vehicle auctions for vehicles that do not meet its retail standards or business requirements.