CarMax Beats on Revenue, Matches Expectations on EPS

CarMax (NYSE: KMX  ) reported earnings on April 10. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Feb. 28 (Q4), CarMax beat expectations on revenues and met expectations on earnings per share.

Compared to the prior-year quarter, revenue grew. GAAP earnings per share grew.

Gross margins shrank, operating margins shrank, net margins were steady.

Revenue details
CarMax reported revenue of $2.83 billion. The 12 analysts polled by S&P Capital IQ predicted a top line of $2.73 billion on the same basis. GAAP reported sales were 14% higher than the prior-year quarter's $2.54 billion.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $0.46. The 15 earnings estimates compiled by S&P Capital IQ averaged $0.46 per share. GAAP EPS of $0.46 for Q4 were 15% higher than the prior-year quarter's $0.40 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 15.3%, 60 basis points worse than the prior-year quarter. Operating margin was 6.2%, 90 basis points worse than the prior-year quarter. Net margin was 3.7%, much about the same as the prior-year quarter. (Margins calculated in GAAP terms.)

Looking ahead
Next quarter's average estimate for revenue is $3.11 billion. On the bottom line, the average EPS estimate is $0.57.

Next year's average estimate for revenue is $12.16 billion. The average EPS estimate is $2.09.

Investor sentiment

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on CarMax is outperform, with an average price target of $40.00.

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