NEW YORK (TheStreet) -- CarMax Inc. (KMX) is scheduled to report its fiscal 2015 third quarter results before the market open on Friday, and analysts are expecting the auto finance and sales company to report a year-over-year increase in earnings per share and revenue for the latest quarter.
CarMax is forecast to post earnings of 54 cents per share on $3.26 billion in revenue for the most recent quarter.
Shares of CarMax are lower by 0.72% to $59.68 in mid-morning trading on Thursday.
For the fiscal 2014 third quarter the company's earnings were 47 cents per diluted share on revenue of $2.94 billion.
Separately, TheStreet Ratings team rates CARMAX INC as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate CARMAX INC (KMX) a BUY. This is driven by multiple strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, growth in earnings per share, increase in net income and notable return on equity. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- KMX's revenue growth has slightly outpaced the industry average of 9.7%. Since the same quarter one year prior, revenues rose by 10.8%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- The stock has risen over the past year as investors have generally rewarded the company for its earnings growth and other positive factors like the ones we have cited in this report. Looking ahead, unless broad bear market conditions prevail, we still see more upside potential for this stock, despite the fact that it has already risen over the past year.
- CARMAX INC has improved earnings per share by 12.9% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, CARMAX INC increased its bottom line by earning $2.17 versus $1.87 in the prior year. This year, the market expects an improvement in earnings ($2.53 versus $2.17).
- The net income growth from the same quarter one year ago has exceeded that of the S&P 500, but is less than that of the Specialty Retail industry average. The net income increased by 10.2% when compared to the same quarter one year prior, going from $140.27 million to $154.52 million.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Specialty Retail industry and the overall market on the basis of return on equity, CARMAX INC has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.
- You can view the full analysis from the report here: KMX Ratings Report