CarMax, Inc. (KMX) Stock

CarMax, Inc. (KMX) is a Consumer Discretionary stock trading at $61.02 (as of 2026-08-20), with a market capitalization of $8.66B and a trailing P/E of 15.6. Figures are sourced from first-party U.S. SEC EDGAR filings and market data.

CarMax, Inc., together with its subsidiaries, operates as a retailer of used vehicles in the United States. The company operates through two segments, CarMax Sales Operations and CarMax Auto Finance. It offers customers a range of makes and models of used vehicles, including domestic, imported, and luxury vehicles, as well as hybrid and electric vehicles; and extended protection plans to customers at the time of sale, as well as sells vehicles that are approximately 10 years old and has more than 100,000 miles through wholesale auctions. The company also provides reconditioning and vehicle repair services; and financing alternatives for retail customers across a range of credit spectrum through its CarMax Auto Finance and arrangements with various financial institutions. As of February 28, 2022, it operated approximately 230 used car stores. CarMax, Inc. was founded in 1993 and is based in Richmond, Virginia.

Understand CarMax, Inc.: how it makes money

CarMax sells used vehicles in the United States and makes money from retail vehicle sales (including online transactions), extended protection plans sold at the time of sale, and from auto financing through CarMax Auto Finance.

Profitability is driven by how retail used-vehicle transaction revenue converts into auto finance originations, with CarMax Auto Finance penetration tied to the company’s used vehicle sales volume.

Business quality (Mixed): Moderate. The provided facts clearly describe the two operating businesses and offer several auto finance and retail metrics, but there is no clean segment revenue split for the official reportable segments in the provided data.

Valuation: At 33× earnings, KMX trades 72% above the Retail average (19×). Note: one-time items can distort reported P/E.

Bull case

  • Finance attach to vehicle sales: CarMax Auto Finance Sales Penetration is around 42.8%, indicating a large share of retail transactions result in auto finance loan originations.
  • Digital is a meaningful sales channel: Digital-Supported Retail Unit Sales are 81.0%, and Revenue from Online Transactions is 1.8 USD_B.
  • Additional non-vehicle revenue streams: Extended Protection Plans Revenue is 0.13 USD_B, adding to retail-related monetization beyond vehicle sales.

Bear case

  • Used-vehicle demand or supply mix pressure: Used Unit Comparable Sales Decline is 6.3%, suggesting weaker comparable used unit performance.
  • Low profitability buffer: Gross margin is 10.7% and operating margin is 3.2%, which can leave less room for adverse trends.
  • Operational cost actions may signal friction: Customer Experience Center Workforce Reduction is 30.0%, which can indicate cost pressure and execution risk if customer experience is impacted.
Valuation — source: SEC EDGAR (first-party)
Price$61.02
Market Cap$8.66B
P/E Ratio15.6
EV / EBITDA24.4
Price / Book1.42
Price / Sales0.31
FCF Yield32.6%
DCF Value (model)$43.08
DCF Upside vs Price-29.4%
Profitability & Growth — source: SEC EDGAR
Revenue (TTM)$25.88B
Net Margin1.0%
Revenue Growth (YoY)-1.8%
EPS Growth (YoY)-47.8%
FCF Growth (YoY)694.2%
Financial Health — source: SEC EDGAR
Altman Z-Score1.63 (distress)
Piotroski F-Score5/9 (moderate)
Valuation vs Sector & Industry
Stock P/E15.6
Sector P/E (Consumer Discretionary)20.5
Industry P/E (Retail)19.5
vs Sector-23.6%
vs Industry-19.9%
Smart-Money Activity — SEC Form 4 / 13F / Congressional disclosures
Top Institutional HolderBlackRock, Inc. ($717.57M)
Institutional Holders Tracked10
Congressional Trades (recent)9
Company
SectorConsumer Discretionary
IndustryRetail
CEODavid W. McCreight
Employees30,048
CountryUS
IPO Date1997-02-04

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Data as of 2026-08-20.

Figures sourced from U.S. Securities and Exchange Commission (SEC EDGAR) filings and market data. Not personalized investment advice.