CarMax Inc
KMX Mid CapConsumer Cyclical · Auto & Truck Dealerships
Updated: Jun 14, 2026, 22:19 UTC
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Valuation Analysis
About the Company
CarMax, Inc., through its subsidiaries, operates as a retailer of used vehicles and related products in the United States. The company operates in two segments: CarMax Sales Operations and CarMax Auto Finance. The CarMax Sales Operations segment offers customers a range of makes and models of used vehicles, including domestic, imported, and luxury vehicles, as well as hybrid and electric vehicles; used vehicle auctions; extended protection plans to customers at the time of sale; and reconditioning and vehicle repair services. The CarMax Auto Finance segment provides financing alternatives for retail customers across a range of credit spectrum and arrangements with various financial institutions. The company was founded in 1993 and is based in Richmond, Virginia.
CarMax Inc Stock at a Glance
CarMax Inc (KMX) is currently trading at $51.26 with a market capitalization of $7.3B. The trailing P/E ratio stands at 30.51x, with a forward P/E of 18.4x. The 52-week range spans from $30.26 to $71.99; the current price is 28.8% below the yearly high. Year-over-year revenue growth stands at -1.2%. The net profit margin stands at 0.89%.
💰 Dividend
CarMax Inc currently does not pay a dividend. The company typically reinvests its earnings into growth initiatives and product development.
📊 Analyst Rating
13 analysts rate CarMax Inc (KMX) on consensus: Hold. The average price target is $42.69, implying -16.71% from the current price. Analyst price targets range from $19.00 to $99.00.
CarMax Inc: The Investment Case in Detail
CarMax Inc (KMX) operates in the Consumer Cyclical — specifically Auto & Truck Dealerships — and is headquartered in United States. Below is a structured read of the investment case built directly from the latest fundamentals, valuation multiples, analyst positioning and smart-money flows. Each section translates raw numbers into the investment logic they imply, so you can decide whether the risk/reward fits your portfolio.
The Bear Case
Revenue is contracting at -1.2% year-over-year — until that trend reverses, valuation is exposed to further downgrades. With a net margin of just 0.89%, the business has little room to absorb cost shocks or pricing pressure — a single bad quarter can swing the company to a loss. The debt-to-equity ratio of 318.18% is elevated, meaning the company relies heavily on creditors — refinancing terms will become more important than operational performance in the next economic downturn.
Valuation in Context
With a PEG ratio of 0.53, the price-to-earnings multiple is actually below the company's growth rate — classic value-meets-growth territory that Peter Lynch would have called a 'GARP' opportunity.
What to Watch Next
- The forward P/E of 18.4x is meaningfully below the trailing 30.51x — analysts expect earnings to step up; the next earnings release is the test.
Investment Thesis: Strengths & Weaknesses
No standout strengths in current data.
- –Revenue shrinking (-1.2% YoY)
- –Low profitability (0.89% margin)
- –High leverage (D/E 318.18)
- –High short interest (12.14%)
- –Negative free cash flow
Technical Snapshot
The price is in a transition zone relative to the moving averages — no clear signal.
Risk Profile
The data points to market-like volatility, elevated short interest (12.14%), higher leverage relative to equity.
Trading Data
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