KMX: CarMax Stock Drives 13% Lower After Q2 Revenue Takes Sharp U-Turn

The used-car retailer posted a 13% year-on-year revenue drop, but still managed to beat the consensus.

• CarMax stock KMX skittered down 13% Thursday after the company released its fiscal second-quarter earnings report. The used-car seller apparently wasn’t the go-to choice for bargain-seeking car buyers. Revenue came in at $7.1bn, down 13% from the year-ago quarter, but just above the $7.02bn estimate.
• For the quarter ended August 31, CarMax’s sold units fell 7.4% on an annualized basis. The average price tag for a sold vehicle declined $1,200 in a nod to receding inflation. To add to the string of declines – net income fell 6% to 75 cents a share, more than double than the 2.3% expected by Wall Street.
• Despite the Thursday drop in share price, CarMax, valued at more than $11bn, is putting up a decent run this year. The stock has gained a hefty 14% year-to-date and is outperforming the broad-based stock average S&P 500, which is up 12% for the same time span.