CarMax (NYSE:KMX) soared on the back of better-than-expected quarterly earnings. CarMax earned 44 cents per share, beating a Refinitiv forecast of 24 cents per share.
Retail used unit sales declined 12.6% in the fourth quarter, and comparable store used unit sales declined 14.1%; wholesale units declined 19.3% in the fourth quarter.
Delivered robust margins in retail and wholesale; gross profit per retail unit of $2,277, an increase of $82 per unit versus last year’s fourth quarter, and gross profit per wholesale unit of $1,187, relatively flat compared to the prior year’s record.
SG&A of $572.8 million decreased 7.7% or $48.1 million from last year’s fourth quarter as a result of active cost management.
Bought 262,000 vehicles from consumers and dealers, down 22.5% versus last year’s record fourth quarter and sequentially up 10.1% from this year’s third quarter.
CarMax Auto Finance income of $123.9 million was down 36.1% from the prior year fourth quarter due to compression in the net interest margin percentage and a higher provision for loan losses, partially offset by an increase in average managed receivables.
Net earnings per diluted share was $0.44, down from $0.98 a year ago. For the fiscal year, net earnings per diluted share declined 56.5% to $3.03.
During the fourth quarter of fiscal 2023, the company opened five new retail locations in Chicago, Illinois, Asheville, North Carolina, Indianapolis, Indiana, College Station, Texas and Amarillo, Texas. We had a total of 240 used car stores as of February 28, 2023.
KMX shares hiked $6.20, or 9.4%, to $72.06.