For new and old investors, taking full advantage of the stock market and investing with confidence are common goals.
Achieving those goals is made easier with the Zacks Style Scores, a unique set of guidelines that rates stocks based on popular investing methodologies, namely value, growth, and momentum. The Style Scores can help you narrow down which stocks are better for your portfolio and which ones can beat the market over the long-term.
Different than growth or momentum investors, value-focused investors are all about finding good stocks at good prices, and discovering which companies are trading under what their true value is before the broader market catches on. The Value Style Score utilizes ratios like P/E, PEG, Price/Sales, and Price/Cash Flow to help pick out the most attractive and discounted stocks.
Headquartered in Richmond, VA, CarMax is the largest retailer of used vehicles in the United States. In fiscal 2024 (ended Feb 28, 2023), CarMax retailed 765,572 used vehicles. The company is also one of the nation’s largest operators of wholesale vehicle auctions, with 546.331 vehicles sold in fiscal 2024.
KMX boasts a Value Style Score of B and VGM Score of A, and holds a Zacks Rank #3 (Hold) rating. Shares of CarMax are trading at a forward earnings multiple of 17.5X, as well as a PEG Ratio of 1.1, a Price/Cash Flow ratio of 13.1X, and a Price/Sales ratio of 0.4X.
A company's earnings performance is important for value investors as well. For fiscal 2026, five analysts revised their earnings estimate higher in the last 60 days for KMX, while the Zacks Consensus Estimate has increased $0.07 to $3.90 per share. KMX also holds an average earnings surprise of 6.9%.
KMX should be on investors' short lists because of its impressive earnings and valuation fundamentals, a good Zacks Rank, and strong Value and VGM Style Scores.
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CarMax, Inc. (KMX) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
Zacks Investment Research
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