CarMax Group Earnings Cheat Sheet: Positive Earnings Streak

S&P 500 (NYSE:SPY) component CarMax Group (NYSE:KMX) reported its results for the third quarter. CarMax is a retailer of used vehicles in the United States. The company also sells new vehicles under franchise agreements with Chrysler, General Motors, Nissan, and Toyota.

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CarMax Group Earnings Cheat Sheet for the Third Quarter

Results: Net income for the auto dealership rose to $82.8 million (36 cents per share) vs. $82.4 million (36 cents per share) in the same quarter a year earlier. This marks a rise of 0.5% from the year earlier quarter.

Revenue: Rose 6.7% to $2.26 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: KMX fell short of the mean analyst estimate of 38 cents per share. Analysts were expecting revenue of $2.25 billion.

Quoting Management: “We are pleased to report another quarter of strong profits, despite a difficult sales comparison and the continued sluggish economy,” said Tom Folliard, president and chief executive officer. “We remain committed to investing in our long-term growth strategy. We now plan to open 10 stores in fiscal 2013 and are pleased to announce our plan to open between 10 and 15 stores per year during each of the following three fiscal years.”

Key Stats:

The company has now seen net income rise in three straight quarters. In the second quarter, net income rose 3.7% and in the first quarter, the figure rose 24.9%.

Revenue has risen the past four quarters. Revenue increased 10.5% to $2.59 billion in the second quarter. The figure rose 18.5% in the first quarter from the year earlier and climbed 22.9% in the fourth quarter of the last fiscal year from the year-ago quarter.

The company has now fallen short of estimates in the last two quarters. In the second quarter, it missed expectations by 2 cents with net income of 49 cents versus a mean estimate of net income of 51 cents per share.

Looking Forward: Analysts appear increasingly negative about the company’s results for the next quarter. The average estimate for the fourth quarter has moved down from 42 cents a share to 40 cents over the last ninety days. At $1.82 per share, the average estimate for the fiscal year has fallen from $1.88 ninety days ago.

Competitors to Watch: Copart, Inc. (NASDAQ:CPRT), America’s Car-Mart, Inc. (NASDAQ:CRMT), KAR Auction Services Inc (NYSE:KAR), AutoNation, Inc. (NYSE:AN), Penske Automotive Group, Inc. (NYSE:PAG), General Motors Company (NYSE:GM), Toyota Motor Corp. (NYSE:TM), Honda Motor CO., Ltd. (NYSE:HMC), Ford Motor Company (NYSE:F), Group one Automotive, Inc. (NYSE:GPI), Sonic Automotive, Inc. (NYSE:SAH).

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)