Bear of the Day: CarMax (KMX)

CarMax KMX is the nation’s largest retailer of used autos, with its omni-channel strategy delivering a very customer-centric offering. Analysts have taken a bearish stance on the company’s EPS outlook, pushing it into a Zacks Rank #5 (Strong Sell).Image Source: Zacks Investment ResearchLet’s take a closer look at what’s been going on.CarMaxKMX shares have had a tough showing in 2025 so far, down more than 50% and regularly being brought down by quarterly results. Retail used units were down 8% in its latest release, with comparable store used unit sales also falling 9%. Sales growth has been minimal, as shown below.Image Source: Zacks Investment ResearchWholesale units were also down 6.2%, gross profit per wholesale unit cratered, with both margin and volume being impacted by steep market depreciation. Importantly, the company announced leadership changed, with David McCreight, interim CEO, stating –“I’m honored to serve as Interim President and CEO at this important juncture for CarMax. Our unmatched physical and digital infrastructure, beloved national brand, and award-winning culture provide us with incredible advantages. Despite these advantages, based on recent results, it is clear CarMax needs change.”Bottom LineAnalysts' negative earnings estimate revisions, resulting from a growth cooldown, paint a challenging picture for the company’s shares in the near term.CarMax KMX is a Zacks Rank #5 (Strong Sell), indicating that analysts have taken a bearish stance on the company’s earnings outlook.For those seeking strong stocks, a great idea would be to focus on stocks carrying a Zacks Rank #1 (Strong Buy) or a Zacks Rank #2 (Buy). These stocks sport a notably stronger earnings outlook and the potential to deliver explosive gains in the near term.5 Stocks Set to DoubleEach was handpicked by a Zacks expert as the favorite stock to gain +100% or more in the months ahead. They includeStock #1: A Disruptive Force with Notable Growth and ResilienceStock #2: Bullish Signs Signaling to Buy the DipStock #3: One of the Most Compelling Investments in the MarketStock #4: Leader In a Red-Hot Industry Poised for GrowthStock #5: Modern Omni-Channel Platform Coiled to SpringMost of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor. While not all picks can be winners, previous recommendations have soared +171%, +209% and +232%.Download Atomic Opportunity: Nuclear Energy's Comeback free today.Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report CarMax, Inc. (KMX): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks