KMX 12-DAY DEADLINE ALERT: CarMax (KMX) Sued Over Alleged "Temporary Demand Pull-Forward" and Loan Portfolio Risk - Hagens Berman

Core Viewpoint - The lawsuit against CarMax, Inc. alleges that the company misled investors by presenting unsustainable growth as robust and failing to disclose significant risks in its loan portfolio [2][4]. Group 1: Allegations and Investigations - The lawsuit claims that CarMax's executives provided materially false and misleading information regarding the company's growth, which was characterized as a temporary "pull forward" of customer demand [2]. - The investigation by Hagens Berman focuses on whether CarMax prioritized short-term optics over transparency, particularly regarding a significant increase in the loan loss provision for the CarMax Auto Finance (CAF) portfolio [3]. Group 2: Financial Impact and Stock Performance - Following the Q2 2026 earnings report, CarMax's stock fell by 20%, with comparable unit sales down by 6.3%, due to misrepresentations about demand and the effects of tariffs [5]. - The departure of the CEO and weak Q3 guidance led to a 24% drop in stock price, highlighting undisclosed business weaknesses and lack of sustainable growth prospects [5]. - An increase of $142 million in the loan loss provision for the CAF portfolio was reported, indicating misrepresentation of the quality and risk associated with the loan portfolio [5]. Group 3: Legal Proceedings and Next Steps - The lawsuit specifically targets investors who purchased CarMax securities between June 20, 2025, and November 5, 2025, and highlights the dual stock crashes as a result of the alleged misrepresentations [5]. - Hagens Berman has a history of securing over $325 billion in settlements and is advising affected investors to discuss their rights [6].