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Analysts predict CarMax's earnings report could boost stock gains, turning a modest sales rise into a larger earnings increase through cost control. They also foresee potential for mid-single-digit annual revenue growth over the next three years if online sales persist. Needham analyst Chris Pierce upgraded the stock to Buy from Hold on March 20, with a price target of $99.
Despite some analysts' optimism, Wall Street remains skeptical about CarMax, with less than half recommending a Buy. Carvana's average price target suggests a 28% drop. Concerns linger about Amazon's entry into auto sales and the volatile used car market.
The declining ROCE and sales for CarMax, along with the increased capital employment, are concerning. Despite the stock's rise in the last five years, the current trends do not inspire confidence in the company's future performance.
Oppenheimer sees Vroom's departure as a chance for CarMax to gain market share and face one less national rival. The firm also highlights potential demand due to aging vehicles in the U.S. and consumers returning to the market as affordability improves.
Despite CarMax's recent sell-off, sustained long-term growth could make it a potential investment. However, investors should note a warning sign spotted with the company.
Camping World outperformed analysts' earnings estimates, while Lithia Motors and CarMax had mixed results. America's Car-Mart underperformed with increased credit losses.
Deep Seaスレ主 : Bad news for the economy is positive for stocks.