Oppenheimer analyst Brian Nagel assigned a Buy rating to CarMax (KMX) today and set a price target of $88. The company’s shares closed yesterday at $59.76, close to its 52-week low of $57.05.
Nagel observed:
“Outperform-rated CarMax (KMX) is set to report fiscal Q3 (Nov.) results on Fri., Dec. 21st, before the market open. Our positive call on KMX has been predicated upon prospects for steadily improving used car unit comps, particularly as comparisons ease, and a historically discounted share valuation. As we look toward the upcoming Q3 announcement, we are encouraged by signals of continued strength in underlying fundamentals, but expect used unit comps could again track light due largely to ongoing pricing anomalies within the used vehicle marketplace. Looking beyond Q3, we note comp comparisons ease meaningfully and should help to bolster growth optics for KMX. Clients are advised to use any share price weakness as a buying opportunity. The company’s recently expanded buyback authorization serves as a vote of confidence in the dynamic KMX model and could help lend support to shares.”
According to TipRanks.com, Nagel is a 4-star analyst with an average return of 3.8% and a 54.2% success rate. Nagel covers the Services sector, focusing on stocks such as Weight Watchers International, Dick’s Sporting Goods, and Advance Auto Parts.
Currently, the analyst consensus on CarMax is a Strong Buy with an average price target of $81, which is a 35.5% upside from current levels. In a report issued on December 14, Wedbush also maintained a Buy rating on the stock with a $87 price target.
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Based on CarMax’s latest earnings release for the quarter ending August 31, the company reported a quarterly net profit of $221 million. In comparison, last year the company had a net profit of $149 million.
Based on the recent corporate insider activity of 66 insiders, corporate insider sentiment is negative on the stock. Most recently, in October 2018, Jon Daniels, the SVP, CAF of KMX sold 16,325 shares for a total of $1,157,052.
TipRanks has tracked 36,000 company insiders and found that a few of them are better than others when it comes to timing their transactions. See which 3 stocks are most likely to make moves following their insider activities.
CarMax, Inc. is as a holding company, which engages in retailing of used vehicles and wholesale vehicle auction operator. It operates through the CarMax Sales Operations and CarMax Auto Finance (CAF) segment.
