Mizuho Reiterates Neutral Rating on CarMax (KMX)

Mizuho analyst David Bellinger reiterated a Neutral rating and $78.00 price target on CarMax (NYSE: KMX).

The analyst commented: "CarMax (KMX) shares traded down ~20% on a pretty sizable fiscal Q2 miss - characterized by a sharp drop-off in comp sales and a higher loan loss provision. A few highlights from our callback with CEO Bill Nash and EVP, CarMax Auto Finance Jon Daniels: 1) Deteriorating credit performance seems contained to the 2022-2023 vintages, with KMX simply not sounding the alarm on some type of broader industry issue for delinquencies; 2) Management may opt to re-deploy all the planned $150M+ of OpEx savings back into the business through advertising and/or lower vehicle prices, but has flexibility to flow some to the bottom-line; 3) With shares down another leg, aggressive buybacks should remain part of the KMX playbook. The path back to sustained positive comps is much less visible today than the past few quarters. We await signs of top-line progression and better earnings visibility. Remain Neutral."

For an analyst ratings summary and ratings history on CarMax click here. For more ratings news on CarMax click here.

Shares of CarMax closed at $45.60 yesterday.

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