CarMax Stock Soars On Earnings Beat But Online Rival Carvana Sinks
CarMax (KMX) crushed earnings views for its fiscal first quarter Friday as cost-control actions paid off. CarMax stock soared but online rival Carvana (CVNA) plunged.
X
CarMax Earnings
The leading used-car retailer posted $1.44 per-share earnings on $7.687 billion revenue for the quarter ended May 31. Year over year, CarMax earnings fell nearly 8% and revenue dropped 17%.
Analysts had braced for CarMax earnings of 79 cents a share and revenue of $7.495 billion, FactSet shows.
CarMax's retail used unit sales declined 9.6% from a year ago. Wholesale units retreated 13.6% vs. a year earlier. Comparable store used unit sales fell 11.4% from a year ago.
SG&A (selling, general and administrative) costs fell 14.8%, or $96.9 million, to $559.8 million, driven by proceeds from a legal settlement and active cost management, CarMax said in an earnings release.
"Our deliberate actions are driving improved trends in the business, despite the challenging macro environment," CarMax CEO Bill Nash said in the earnings release.
CarMax Stock, CVNA Stock
Shares of CarMax leapt 9.4% to 85.81 on the stock market today. KMX stock topped a 73.57 cup-with-handle buy point in May and is far extended.
Upstart rival Carvana tanked 12.3% Friday. CVNA stock has skyrocketed around 370% year to date amid an improving financial outlook.
On Wednesday, the Wall Street Journal reported a potential takeover bid for embattled auto, home and renters insurer Root (ROOT), at a big premium. But bidder Embedded Insurance hasn't managed to negotiate a deal, the report said.
Carvana, an online used-car seller, invested in Root in 2021. The companies partnered to provide car insurance to Carvana customers.
ROOT stock sank 12% Friday after soaring Wednesday.
YOU MAY ALSO LIKE:
These Are The 5 Best Stocks To Buy And Watch Now
Stocks To Watch: Top-Rated IPOs, Big Caps And Growth Stocks
Find The Latest Stocks Hitting Buy Zones With MarketSmith
Source: Investor's Business Daily
