Accessibility StatementSkip Navigation KMX Investors with Losses Encouraged to Contact the Firm SAN FRANCISCO, Dec. 1, 2025 /PRNewswire/ --Â On November 6, 2025, investors in CarMax, Inc. (NYSE: KMX) saw shares plummet $9.93 (-24%) after the company announced that it fired CEO Bill Nash and issued its new Q3 2026 preliminary outlook on comparable store used unit sales, calling for a decline of 8%-12% from a year ago. The developments are the latest following CarMax's dismal Q2 2026 results, which drove the ...

Core Viewpoint - The Gross Law Firm has issued a notice to shareholders of CarMax, Inc. regarding a class action lawsuit alleging that the company made materially false and misleading statements about its growth prospects during a specified period [1]. Group 1: Allegations and Class Period - The class period for the allegations is from June 20, 2025, to November 5, 2025 [1]. - The complaint claims that CarMax's growth was overstated, attributing earlier growth in the 2026 fiscal year to temporary customer behavior influenced by speculation about tariffs [1]. - It is alleged that the statements made by the defendants regarding CarMax's business and operations were materially false and lacked a reasonable basis [1]. Group 2: Next Steps for Shareholders - Shareholders who purchased shares of KMX during the class period are encouraged to register for the class action by January 2, 2026 [2]. - Upon registration, shareholders will be enrolled in a portfolio monitoring system to receive updates on the case [2]. - There is no cost or obligation for shareholders to participate in the case [2]. Group 3: About the Gross Law Firm - The Gross Law Firm is a nationally recognized class action law firm focused on protecting investors' rights against deceit and illegal business practices [3]. - The firm aims to ensure companies adhere to responsible business practices and seeks recovery for investors who suffered losses due to misleading statements [3].

Core Viewpoint - A class action lawsuit has been filed against CarMax, Inc. and certain senior executives for securities fraud following a significant stock drop attributed to potential violations of federal securities laws [1][2]. Group 1: Lawsuit Details - Investors have until January 2, 2026, to request to lead the case, which is pending in the U.S. District Court for the District of Maryland [2]. - The lawsuit asserts claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 on behalf of CarMax investors [2]. Group 2: Company Performance and Stock Impact - CarMax reported disappointing financial results for Q2 FY 2026, including a 5.4% decline in retail used unit sales, a 6.3% decline in comparable store used unit sales, and a 2.2% decline in wholesale units [5]. - The company's net income for Q2 was approximately $95.4 million, down from $132.8 million the previous year, attributed to a "pull forward" in demand due to U.S. tariffs [5]. - Following the financial report, CarMax's stock dropped $11.45 per share, or roughly 20%, from $57.05 on September 24, 2025, to $45.60 on September 25, 2025 [6]. - An unexpected departure of CEO Bill Nash on November 6, 2025, and a weak preliminary Q3 2025 outlook led to an additional stock drop of over 24% [6]. Group 3: Company Background - CarMax is a leading retailer of used cars, emphasizing a seamless customer experience and strong demand for its vehicles [3]. - The firm Bleichmar Fonti & Auld LLP, which is representing the plaintiffs, has a strong track record in securities class actions and has recovered significant amounts for other clients [10].

Core Viewpoint - An amended securities class action lawsuit has been filed against CarMax, Inc., expanding the class period to include those who purchased CarMax securities between June 20, 2025, and November 5, 2025 [1] Group 1: Allegations Against CarMax - The complaint alleges that Defendants made false and/or misleading statements regarding CarMax's growth prospects, claiming that earlier growth was a temporary benefit due to customer speculation about tariffs [3] - It is asserted that the positive statements made by Defendants about the company's business and operations were materially misleading and lacked a reasonable basis [3] Group 2: Legal Process and Participation - CarMax investors can seek to be appointed as a lead plaintiff representative of the class by January 2, 2026, or may choose to remain absent [4] - The lead plaintiff will act on behalf of all class members and select counsel to represent the class, with the ability to share in any recovery not affected by the decision to serve as a lead plaintiff [4] Group 3: Law Firm Information - Kessler Topaz Meltzer & Check, LLP is encouraging CarMax investors who have suffered significant losses to contact the firm for more information [5] - The firm has a global reputation for excellence in prosecuting class actions and has recovered billions for victims of fraud and corporate misconduct [5]

Core Viewpoint - CarMax, Inc. is facing a class action lawsuit for securities fraud following a significant drop in its stock price, attributed to alleged violations of federal securities laws [2][4]. Group 1: Lawsuit Details - The lawsuit was filed by Bleichmar Fonti & Auld LLP on behalf of investors, asserting claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 [4]. - Investors have until January 2, 2026, to request to lead the case in the U.S. District Court for the District of Maryland [4]. Group 2: Financial Performance - CarMax reported disappointing financial results for Q2 of fiscal year 2026, with a 5.4% decline in retail used unit sales, a 6.3% decline in comparable store used unit sales, and a 2.2% decline in wholesale units [7]. - The company's net income for Q2 was approximately $95.4 million, down from $132.8 million in the previous year [7]. Group 3: Stock Price Impact - Following the announcement of poor financial results on September 25, 2025, CarMax's stock price fell by $11.45 per share, or roughly 20%, from $57.05 to $45.60 [8]. - The unexpected departure of CEO Bill Nash on November 6, 2025, along with a weak preliminary Q3 outlook, led to an additional stock price drop of over 24% [8]. Group 4: Company Operations - CarMax's management had previously emphasized strong demand for its vehicles, which was later alleged to have been artificially boosted by pre-tariff purchases [5]. - The law firm is also investigating whether CarMax adequately assessed its portfolio of car loans following the CEO's departure [6].

Core Viewpoint - CarMax is facing significant challenges as it prepares for its upcoming earnings report, with a stock price decline of over 50% year-to-date and a 75% drop from its all-time high in November 2021, marking one of the deepest slumps among major specialty retailers [1][2]. Group 1: Company Performance - CarMax's market capitalization is currently $5.5 billion, making it the second-smallest stock in the Consumer Discretionary Sector SPDR Fund, which has been one of the worst-performing sectors this year [2]. - The company is operating under an interim CEO and interim executive chairman after the removal of former CEO Bill Nash, with upcoming Q3 results expected to reset expectations for the largest used car retailer in the U.S. [3]. Group 2: Market Conditions - The average price of used cars remains close to $26,000, leading customers to opt for older, higher-mileage vehicles, while interest rates are still high, with an average of 11.2% reported in Q2, impacting affordability and wholesale transactions [5]. - Despite these pressures, CarMax's shares are at historically low valuations, with price-to-earnings at 11.2, price-to-sales at 0.2, and price-to-book at 0.9, the lowest in the past 20 years [6]. Group 3: Leadership Changes - The board's decision to remove the long-tenured CEO highlights the urgency of the situation, with interim leaders tasked with stabilizing the business and adapting to changing consumer preferences [7]. - The board believes that increased involvement from interim leaders will strengthen the business during this transitional period, focusing on driving sales, enhancing profitability, and reducing costs [8]. Group 4: Future Outlook - CarMax is positioned as a deep-value turnaround story amid a challenging affordability cycle and leadership changes, with potential for rebound if pricing normalizes and interest rates decrease [9].

Core Viewpoint - Rosen Law Firm is encouraging investors of CarMax, Inc. to secure legal counsel before the January 2, 2026 deadline for a securities class action lawsuit related to misleading statements made by the company during the class period from June 20, 2025, to November 5, 2025 [2][6]. Group 1: Class Action Details - Investors who purchased CarMax securities during the specified class period may be entitled to compensation without any out-of-pocket fees through a contingency fee arrangement [3]. - A class action lawsuit has already been filed, and potential lead plaintiffs must act by January 2, 2026, to represent other class members [4][6]. - The lawsuit alleges that CarMax made materially false and misleading statements regarding its growth prospects, which were based on temporary benefits rather than sustainable growth [6]. Group 2: Rosen Law Firm's Credentials - Rosen Law Firm has a strong track record in securities class actions, having achieved significant settlements, including the largest securities class action settlement against a Chinese company [5]. - The firm has been ranked highly for its number of securities class action settlements and has recovered hundreds of millions of dollars for investors, including over $438 million in 2019 alone [5]. - The founding partner of Rosen Law Firm was recognized as a leading figure in the plaintiffs' bar, highlighting the firm's expertise and reputation in this area [5].

Core Viewpoint - An amended securities class action lawsuit has been filed against CarMax, Inc., expanding the class period to include those who purchased or acquired CarMax securities between June 20, 2025, and November 5, 2025 [1] Allegations Against Defendants - The complaint alleges that during the class period, defendants made false and misleading statements, overstating CarMax's growth prospects, which were actually inflated due to temporary factors related to customer behavior influenced by tariff speculation [2] - It is claimed that the positive statements made by defendants regarding the company's business and operations were materially misleading and lacked a reasonable basis [2] Lead Plaintiff Process - CarMax investors have until January 2, 2026, to seek appointment as a lead plaintiff representative of the class, or they may choose to remain absent class members [3] - The lead plaintiff will act on behalf of all class members and select counsel to represent the class, with the ability to share in any recovery not affected by the decision to serve as lead plaintiff [3] Firm Background - Kessler Topaz Meltzer & Check, LLP is known for prosecuting class actions and has a reputation for recovering billions for victims of fraud and corporate misconduct [4]

Company Performance - CarMax has significantly underperformed the S&P 500, with a 56% decline in stock price over the past year compared to a 13% increase in the S&P 500 [3] - Over three years, CarMax's stock has decreased by 43.6%, while the S&P 500 has risen by 68% [3] - In the last five years, CarMax's stock has dropped by 60.5%, against an 86% increase in the S&P 500 [3] Industry Challenges - The used car market has faced numerous challenges since early 2020, including squeezed gross margins and decreased demand due to high vehicle prices [4] - Increased competition from digital-first competitors like Carvana has negatively impacted CarMax's fiscal performance [4] Recent Developments - CarMax's recent stock decline followed worse-than-expected guidance and the unexpected resignation of CEO Bill Nash, effective December 1 [7] - The company has initiated a turnaround plan that includes targeted cost savings of $150 million over the next 18 months [7] Future Outlook - If CarMax's turnaround efforts coincide with improved demand in the coming year, the company could see a return to improved financial results [8] - Currently, CarMax shares trade at a forward P/E ratio of 10, which is below the historical range of 15 to 20 times earnings, suggesting potential for valuation expansion [8] - There is a possibility for CarMax to achieve market-beating returns if profitability improves and valuation expands in the future [9]

Core Insights - Makaira Partners LLC has completely divested its stake in CarMax, amounting to an estimated $18.3 million [1][2][3] - The divestment occurred during a period of significant downsizing for Makaira, with assets under management (AUM) decreasing by 41% quarter over quarter [3][6] Company Overview - CarMax is a leading U.S. retailer of used vehicles, operating over 230 stores and utilizing both physical and digital retail channels to enhance customer engagement [5][8] - The company reported a total revenue of $26.4 billion and a net income of $521.1 million for the trailing twelve months (TTM) [3] - As of November 14, 2025, CarMax's market capitalization was approximately $5.1 billion, with a stock price of $34.43 [3] Investment Context - The decision by Makaira to exit its position in CarMax reflects a broader strategy of reducing holdings in underperforming assets, as indicated by the company's recent struggles and a challenging quarter reported by its CEO [9] - Makaira's portfolio management approach is influenced by a concentrated investment strategy, similar to that of Warren Buffett, suggesting that CarMax was not a high-conviction investment for the firm [9]