Equity Profile

KMX

CarMax, Inc.

Consumer DiscretionaryAutomotive Retail$6.7B

Jun17Wed

Pre-Earnings Brief

UpcomingQ1-2027Pre-Market9:00 AM EDT

Company Snapshot

CarMax, Inc. (KMX) is a leading retailer of used cars in the U.S., providing a no-haggle pricing model that appeals to consumers seeking transparency in their car purchases....

Key Metrics to Watch

Used Vehicle Sales Growth

This metric indicates how well CarMax is performing in a competitive used car market, which is crucial for revenue generation.

N/A

Gross Profit per Vehicle

This reflects the profitability of each vehicle sold, which is vital for understanding overall financial health.

N/A

1 more metrics, Wall Street expectations, options signals, track record, and call prep available with Pro.

KMX Q1-2027 Earnings Preview

Context

Company Snapshot

CarMax, Inc. (KMX) is a leading retailer of used cars in the U.S., providing a no-haggle pricing model that appeals to consumers seeking transparency in their car purchases. As a part of the consumer discretionary sector, CarMax's performance is closely tied to consumer spending trends and the overall health of the automotive market.

Earnings Scorecard·Last 8Q

EPS Beat Streak

EPS Beat Rate

38%

Avg EPS Surprise

+3.17%

Avg Stock Reaction

-6.71%

Last Quarter Recap

In the last quarter (Q4-2026), CarMax reported an earnings per share (EPS) of $0.34, significantly beating expectations of $0.22. However, the stock saw a decline of 15.12% the following day, indicating market concerns despite the earnings surprise.

Management Promises & Guidance

Expectations

Wall Street Expectations

Overall, analysts are cautious about CarMax's upcoming earnings, especially given the mixed results from previous quarters and the recent decline in stock price despite earnings beats.

Bull Case

If CarMax can demonstrate strong used vehicle sales growth and improved profit margins, it could signal a recovery in consumer demand and operational efficiency, leading to a positive market reaction.

Bear Case

Conversely, if the company reports disappointing sales figures or declining profit margins, it could exacerbate existing concerns about market competitiveness and consumer spending, leading to further stock declines.

Expectations

Two Questions That Matter

The print will turn on these two things.

What is the growth rate of used vehicle sales compared to last year?

This figure will indicate whether CarMax is gaining market share or losing ground in a competitive environment, which is critical for future revenue.

How has the gross profit per vehicle changed in this quarter?

Understanding profit margins will help assess the company's pricing strategy and cost management, which are essential for profitability.

Edge

What the Street Is Missing

Why consensus could be wrong

The Street may be underestimating CarMax's ability to capitalize on the growing demand for used vehicles, especially as new car inventories remain low.

Supporting Evidence

Despite recent earnings surprises, the stock has consistently reacted negatively, indicating potential overreactions to short-term results.

The options market is pricing a larger move than historical averages, suggesting that investors are bracing for significant news that could drive the stock in either direction.

Key Risk

If used vehicle sales growth exceeds 10%, it could challenge the current bearish sentiment and lead to a reassessment of CarMax's market position.

Edge

Thesis-Break Levels

Pre-commit to what would confirm each case.

The market is closely watching CarMax's ability to navigate a challenging used car market while maintaining profitability and sales growth.

Bull Confirmed If

Used vehicle sales growth of at least 10% year-over-year, indicating strong demand and market positioning.

Bear Confirmed If

Gross profit per vehicle falling below $1,500, suggesting pricing pressures and reduced profitability.

Pre-Earnings Positioning

Options Market

Implied Move

±14.06%

Historical Avg

±9.7%

Pricing rich

The options market is pricing in a significant potential move for CarMax's stock following the earnings report, suggesting heightened uncertainty among investors.

Options are pricing ±14.1% while KMX has averaged ±9.7% over the last 8 prints — setup is pricing rich.

Detail

ATM IV

0.8%

30d HV

42.6%

Calls (85K)P/C Ratio: 0.33Puts (70K)

Preparation

Post-Print Playbook

Likely market behavior by outcome — not investment advice.

Beat & Raise

If CarMax beats expectations, history suggests the stock could rise by an average of 4.25%, confirming positive momentum and investor confidence.

In-Line / Cautious

If results are in line with expectations but management provides cautious commentary, the stock may experience a muted reaction as investors weigh future risks.

Miss

If CarMax misses earnings expectations, history suggests a potential decline of around 8.19%, reflecting investor disappointment and concerns about market conditions.

Earnings Track Record

Preparation

What to Listen For

Call Prep

1Any updates on inventory levels and how they are affecting sales.
2Details on customer demand trends for used vehicles.
3Insights into pricing strategies and gross profit margins.
4Management's outlook on the competitive landscape in the automotive retail sector.
5Any commentary on operational efficiencies and cost management efforts.

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Company Snapshot

CarMax, Inc. (KMX) is a leading retailer of used cars in the U.S., providing a no-haggle pricing model that appeals to consumers seeking transparency in their car purchases....

Key Metrics to Watch

Used Vehicle Sales Growth

This metric indicates how well CarMax is performing in a competitive used car market, which is crucial for revenue generation.

N/A

Gross Profit per Vehicle

This reflects the profitability of each vehicle sold, which is vital for understanding overall financial health.

N/A

1 more metrics, Wall Street expectations, options signals, track record, and call prep available with Pro.

KMX Q1-2027 Earnings Preview

Context

Company Snapshot

Earnings Scorecard·Last 8Q

EPS Beat Streak

EPS Beat Rate

38%

Avg EPS Surprise

+3.17%

Avg Stock Reaction

-6.71%

Last Quarter Recap

Management Promises & Guidance

Expectations

Wall Street Expectations

Overall, analysts are cautious about CarMax's upcoming earnings, especially given the mixed results from previous quarters and the recent decline in stock price despite earnings beats.

Bull Case

Bear Case

Expectations

Two Questions That Matter

The print will turn on these two things.

What is the growth rate of used vehicle sales compared to last year?

This figure will indicate whether CarMax is gaining market share or losing ground in a competitive environment, which is critical for future revenue.

How has the gross profit per vehicle changed in this quarter?

Understanding profit margins will help assess the company's pricing strategy and cost management, which are essential for profitability.

Edge

What the Street Is Missing

Why consensus could be wrong

The Street may be underestimating CarMax's ability to capitalize on the growing demand for used vehicles, especially as new car inventories remain low.

Supporting Evidence

Despite recent earnings surprises, the stock has consistently reacted negatively, indicating potential overreactions to short-term results.

The options market is pricing a larger move than historical averages, suggesting that investors are bracing for significant news that could drive the stock in either direction.

Key Risk

If used vehicle sales growth exceeds 10%, it could challenge the current bearish sentiment and lead to a reassessment of CarMax's market position.

Edge

Thesis-Break Levels

Pre-commit to what would confirm each case.

The market is closely watching CarMax's ability to navigate a challenging used car market while maintaining profitability and sales growth.

Bull Confirmed If

Used vehicle sales growth of at least 10% year-over-year, indicating strong demand and market positioning.

Bear Confirmed If

Gross profit per vehicle falling below $1,500, suggesting pricing pressures and reduced profitability.

Pre-Earnings Positioning

Options Market

Implied Move

±14.06%

Historical Avg

±9.7%

Pricing rich

The options market is pricing in a significant potential move for CarMax's stock following the earnings report, suggesting heightened uncertainty among investors.

Options are pricing ±14.1% while KMX has averaged ±9.7% over the last 8 prints — setup is pricing rich.

Detail

ATM IV

0.8%

30d HV

42.6%

Calls (85K)P/C Ratio: 0.33Puts (70K)

Preparation

Post-Print Playbook

Likely market behavior by outcome — not investment advice.

Beat & Raise

If CarMax beats expectations, history suggests the stock could rise by an average of 4.25%, confirming positive momentum and investor confidence.

In-Line / Cautious

If results are in line with expectations but management provides cautious commentary, the stock may experience a muted reaction as investors weigh future risks.

Miss

If CarMax misses earnings expectations, history suggests a potential decline of around 8.19%, reflecting investor disappointment and concerns about market conditions.

Earnings Track Record

Preparation

What to Listen For

Call Prep

1Any updates on inventory levels and how they are affecting sales.
2Details on customer demand trends for used vehicles.
3Insights into pricing strategies and gross profit margins.
4Management's outlook on the competitive landscape in the automotive retail sector.
5Any commentary on operational efficiencies and cost management efforts.