Core Viewpoint - Rosen Law Firm is reminding investors who purchased CarMax, Inc. securities between June 20, 2025, and November 5, 2025, of the January 2, 2026, deadline to become lead plaintiffs in a securities class action lawsuit [1]. Group 1: Class Action Details - Investors who bought CarMax securities during the specified Class Period may be eligible for compensation without any out-of-pocket fees through a contingency fee arrangement [2]. - A class action lawsuit has already been filed, and interested parties can join by contacting Rosen Law Firm [3][6]. - The lawsuit alleges that CarMax's defendants made materially false and misleading statements regarding the company's growth prospects, which were overstated due to temporary market conditions [5]. Group 2: Law Firm Credentials - Rosen Law Firm emphasizes the importance of selecting qualified legal counsel with a successful track record in securities class actions, highlighting its own achievements, including the largest securities class action settlement against a Chinese company [4]. - The firm has been ranked No. 1 for securities class action settlements in 2017 and has consistently ranked in the top 4 since 2013, recovering hundreds of millions of dollars for investors [4].

Core Insights - CarMax is currently facing financial challenges, including declining revenues and unit sales, which have led analysts to set a price target of $36 for its stock, indicating potential downside from its current trading price of $39.34 [1][3] Company Overview - CarMax, Inc. is a leading retailer of used vehicles in the United States, operating through two segments: CarMax Sales Operations and CarMax Auto Finance. The company is facing competition from other used car retailers and online platforms [2] Financial Performance - In Q3 2025, CarMax reported an 8% decrease in retail used vehicle unit sales and a 12.9% reduction in total gross profit, attributed to intense competition and stabilization of used car prices [3] - The stock has fluctuated between $38.34 and $41.97 on a recent trading day, with a market capitalization of approximately $5.91 billion and a trading volume of 12.26 million shares on the NYSE [4] Management Actions - Despite the financial challenges, CarMax is actively repurchasing shares, with $1.36 billion authorized for this purpose, signaling management's confidence in the company's future prospects [4]

CarMax Inc. (NYSE:KMX) reported better-than-expected third-quarter 2025 earnings on Thursday.The used-car retail giant reported earnings per share of 43 cents, beating the analyst consensus estimate of 39 cents. Adjusted earnings per share for the quarter were 51 cents, which excluded restructuring charges of 8 cents per share. Quarterly sales of $5.794 billion, down 6.9% year-over-year, surpassed the Street view of $5.678 billion.“Our unmatched physical and digital infrastructure, beloved national brand, a ...

Core Insights - CarMax Inc. reported better-than-expected third-quarter 2025 earnings with earnings per share of 43 cents, surpassing the analyst consensus estimate of 39 cents [1] - Adjusted earnings per share for the quarter were 51 cents, excluding restructuring charges of 8 cents per share [1] - Quarterly sales reached $5.794 billion, a decrease of 6.9% year-over-year, but exceeded the Street view of $5.678 billion [1] Management Commentary - Interim President and CEO David McCreight acknowledged the need for change despite the company's strong physical and digital infrastructure, brand, and culture [2] - McCreight emphasized the commitment to position CarMax for success while the Board searches for a permanent CEO [2] - Following the earnings announcement, CarMax shares dipped 1.6% to $38.71 [2] Analyst Reactions - Mizuho analyst David Bellinger maintained a Neutral rating and lowered the price target from $46 to $36 [4] - Wedbush analyst Scott Devitt also maintained a Neutral rating and cut the price target from $40 to $36 [4] - Stephens & Co. analyst Jeff Lick maintained an Equal-Weight rating and reduced the price target from $39 to $36 [4] - JP Morgan analyst Rajat Gupta maintained an Underweight rating and lowered the price target from $30 to $28 [4] - RBC Capital analyst Steven Shemesh maintained a Sector Perform rating and raised the price target from $34 to $37 [4]

Legal Analysis: Undisclosed Business Weakness & Risk The complaint details the alleged gap between the Company's public statements about sustainable growth and the undisclosed material adverse facts regarding its operational and financial stability. | Disclosure Event | Impact on KMX Stock Price | Alleged Securities Violation Revealed | | --- | --- | --- | | Q2 2026 Earnings | Stock fell 20%; comparable | Misrepresenting the nature of demand; failing to disclose | | (Sept. 25, 2025) | unit sales down 6.3%. ...

Core Insights - CarMax Inc. reported third-quarter fiscal 2026 adjusted earnings per share of 51 cents, exceeding the Zacks Consensus Estimate of 32 cents, but down from 81 cents in the same quarter last year. Revenues reached $5.8 billion, surpassing the Zacks Consensus Estimate of $5.7 billion, although sales declined by 6.9% year over year [1][9]. Segment Performance - Used-vehicle net sales for CarMax totaled $4.54 billion, a decrease of 7% year over year, attributed to an 8% decline in unit sales, totaling 169,557 vehicles, which was below the forecast of 191,402 units. The average selling price (ASP) of used vehicles increased by 0.9% to $26,383, exceeding the projection of $25,578 [3]. - Comparable store used-vehicle units decreased by 9%, with revenues falling by 8.1% from the prior year. The gross profit per unit (GPU) for used vehicles was $2,235, down from $2,306 in the previous year but above the estimate of $1,978.2 [4]. - Wholesale vehicle revenues decreased by 6.3% year over year to $1,095.1 million, which was above the projection of $1,069.4 million. Units sold fell by 6.2% to 127,603, below the forecast of 139,339. The ASP for wholesale vehicles declined by 0.5% to $8,137, surpassing the estimate of $7,675. Wholesale GPU was $899, down from $1,015 in the prior year but above the estimate of $840.6 [5]. - Other sales and revenues decreased by 9.2% year over year to $150.6 million, missing the estimate of $170.3 million. CarMax Auto Finance's income rose by 9.3% year over year to $174.7 million [6]. Financial Overview - Selling, general, and administrative expenses increased by 1% year over year to $581.4 million. As of November 30, 2025, CarMax had cash and cash equivalents of $204.9 million and long-term debt of $1.17 billion. During the fiscal third quarter, the company repurchased shares worth $201.6 million, with $1.36 billion remaining under the share repurchase authorization [7].

Core Insights - The article emphasizes the importance of identifying high-quality companies with a strong track record of reinvesting capital for significant returns, aiming for a long-term capital compounding capability that could yield tenfold returns or more [1]. Investment Strategy - The investment approach is primarily conservative, focusing on long-term holdings to achieve higher returns compared to market indices, especially in a landscape where short-term investments are becoming more common [1]. - Occasionally, the strategy may include pursuing opportunities with a favorable risk-reward ratio, where the potential upside is substantial and the downside is limited, ensuring overall portfolio stability [1].

Core Insights - Two respected investors, Akre Capital Management and Giverny Capital Management, have maintained long-term positions in CarMax (KMX), prompting further analysis of the company [1] Group 1: Investment Strategy - The focus is on identifying high-quality companies with a proven ability to reinvest capital for impressive returns [1] - The ideal companies should demonstrate a long-term capability of capital compounding, potentially delivering tenfold returns or greater [1] - A long-term perspective is emphasized as a means to generate higher returns compared to market indices in a rapidly evolving investment landscape [1] Group 2: Investment Approach - A conservative investment strategy is primarily adopted, with occasional pursuit of opportunities that present a favorable risk-reward ratio [1] - Such ventures are carefully considered and allocated a proportional amount within the portfolio to maintain overall stability [1]

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 price dropped by $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, along with 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 law firm Bleichmar Fonti & Auld LLP, known for representing plaintiffs in securities class actions, is handling the lawsuit against CarMax [10].

Core Viewpoint - CarMax Inc. plans to reduce retail margins and increase marketing spending despite reporting better-than-expected third-quarter sales, leading to a nearly 2% decline in shares [1] Financial Performance - The company reported earnings of $0.43 per share for the third quarter of fiscal 2026, surpassing the consensus estimate of $0.37 [1] - Revenue decreased approximately 7% year over year to $5.8 billion, but exceeded analyst expectations of $5.69 billion [1] Sales Trends - Retail used unit sales fell 8% compared to the previous year, while comparable store used unit sales declined 9% [2] - CarMax provided a preliminary outlook for the fourth quarter of fiscal 2026, focusing on initiatives to improve sales trends [2] Strategic Initiatives - The company plans to enhance price competitiveness by lowering retail used unit margins during the upcoming quarter [2] - CarMax expects to increase marketing spending on a total unit basis compared to the previous year, although at a lesser degree than in the third quarter [3] - Marketing efforts will concentrate on customer acquisition to support vehicle purchases and overall sales as the company aims to stabilize demand [3]