Core Viewpoint - A class action securities lawsuit has been filed against CarMax, Inc. alleging securities fraud that affected investors between June 20, 2025, and November 5, 2025 [1][2]. Group 1: Lawsuit Details - The lawsuit claims that defendants made false statements and concealed information regarding CarMax's growth prospects, suggesting that the growth was temporary and driven by speculation about tariffs [2]. - It is alleged that the statements made by the defendants about CarMax's business operations and prospects were materially false and misleading [2]. Group 2: Investor Information - Investors who suffered losses during the specified time frame have until January 2, 2026, to request to be appointed as lead plaintiff, although participation in any recovery does not require serving as a lead plaintiff [3]. - Class members may be entitled to compensation without any out-of-pocket costs or fees [3]. Group 3: Firm Background - Levi & Korsinsky has a history of securing hundreds of millions of dollars for shareholders and has been recognized as one of the top securities litigation firms in the United States for seven consecutive years [4].

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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][3]. Group 1: Lawsuit Details - The lawsuit is pending in the U.S. District Court for the District of Maryland, titled Jason Cap v. CarMax, Inc., et al., No. 1:25-cv-03602, with claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 [3]. - Investors have until January 2, 2026, to request to be appointed to lead the case [3]. Group 2: Reasons for the Lawsuit - CarMax has been accused of misleading investors regarding the demand for its used cars, which was allegedly inflated by a temporary boost due to U.S. tariffs on cars [4]. - The unexpected departure of CEO Bill Nash on November 6, 2025, is also under investigation to determine if CarMax properly assessed its portfolio of car loans [5]. Group 3: Stock Performance - On September 25, 2025, CarMax reported disappointing financial results, including a 5.4% decline in retail used unit sales and a net income drop from $132.8 million to approximately $95.4 million year-over-year [6]. - Following the financial report, CarMax's stock price fell by $11.45 per share, or about 20%, from $57.05 to $45.60 [7]. - The announcement of CEO Bill Nash's departure and a weak preliminary Q3 2025 outlook led to an additional stock drop of over 24% [7].

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Core Viewpoint - CarMax, Inc. reported strong earnings and revenue but faces challenges in maintaining profitability due to plans to reduce margins on used cars and declining sales figures [2][3][6] Financial Performance - CarMax reported earnings per share of $0.43, exceeding the estimated $0.32, and revenue of approximately $5.79 billion, surpassing the estimated $5.63 billion [2][6] - The company announced plans to reduce margins on used cars, which has negatively impacted its stock price due to concerns over future profitability [2][6] Market Challenges - CarMax experienced an 8% decrease in retail used unit sales and a 9% decline in comparable store used unit sales, indicating competitive pressures in the used-car market [3][6] Financial Metrics - The company has a price-to-earnings (P/E) ratio of approximately 11.88, a price-to-sales ratio of about 0.24, and an enterprise value to sales ratio of around 0.89, reflecting its market valuation [4] - CarMax's debt-to-equity ratio is approximately 2.87, indicating significant financial obligations relative to its equity, while the current ratio stands at about 2.46, suggesting good short-term liability coverage [5] - The earnings yield for CarMax is about 8.42%, providing some reassurance to investors regarding returns on investment [5]

Core Viewpoint - CarMax, Inc. (KMX) shares have significantly underperformed over the past year, losing approximately 50% of their value due to weak sales driven by affordability pressures on lower-income consumers, which has also led to the departure of its CEO [1] Company Performance - The used car retailer has faced challenges with sales, particularly among lower-income consumers who are experiencing financial strain [1] Leadership Changes - The departure of the CEO is a notable event linked to the company's struggles, indicating potential issues in management or strategy [1]

CarMax, Inc. ( KMX ) shares have been a very poor performer over the past year, losing about half of their value. The used car retailer has struggled with weak sales as lower-income consumers face affordability pressure, leading to the departure of its CEO. WhileOver fifteen years of experience making contrarian bets based on my macro view and stock-specific turnaround stories to garner outsized returns with a favorable risk/reward profile. If you want me to cover a specific stock or have a question for an ...

Core Insights - CarMax (KMX) reported a revenue of $5.79 billion for the quarter ended November 2025, reflecting a year-over-year decline of 6.9% and an EPS of $0.51, down from $0.81 a year ago, but exceeding the Zacks Consensus Estimate for revenue by 1.18% and for EPS by 59.38% [1] Financial Performance Metrics - Comparable Store Used Vehicles Sales decreased by 8.1%, slightly worse than the average estimate of -7.8% [4] - The total number of stores was 250, below the average estimate of 256 [4] - Gross Profit per Unit for used vehicles was $2,235, surpassing the average estimate of $2,207.35 [4] - Gross Profit per Unit for wholesale vehicles was $899, lower than the average estimate of $918.80 [4] - Average Selling Prices for wholesale vehicles were $8.14 thousand, slightly above the estimated $8.06 thousand [4] - Net sales and operating revenues for wholesale vehicles were $1.1 billion, exceeding the average estimate of $1.05 billion, but representing a year-over-year decline of 6.3% [4] - Net sales and operating revenues for other sales and revenues were $150.63 million, below the average estimate of $159.33 million, marking a 9.2% year-over-year decline [4] - Net sales and operating revenues for used vehicles were $4.55 billion, slightly above the average estimate of $4.52 billion, reflecting a 7% year-over-year decrease [4] - Other sales and revenues from third-party finance fees were reported at -$3 million, significantly worse than the average estimate of $0.5 million, indicating a 400% year-over-year decline [4] - Extended protection plan revenues were $96.6 million, below the average estimate of $101.08 million, representing an 8.4% year-over-year decline [4] - Other sales and revenues from advertising & subscription were $35.1 million, lower than the estimated $36.6 million, showing a 2.8% year-over-year decrease [4] Stock Performance - CarMax shares have returned +20.1% over the past month, outperforming the Zacks S&P 500 composite's +0.9% change [3] - The stock currently holds a Zacks Rank 5 (Strong Sell), indicating potential underperformance in the near term [3]