KMX gets a fundamental rating of 3 out of 10. The analysis compared the fundamentals against 122 industry peers in the Specialty Retail industry. KMX may be in some trouble as it scores bad on both profitability and health. KMX has a correct valuation and a medium growth rate.

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

In the past year KMX was profitable.
In the past year KMX had a positive cash flow from operations.
KMX had positive earnings in each of the past 5 years.
KMX had a positive operating cash flow in 4 of the past 5 years.

1.2 Ratios

KMX's Return On Assets of 1.79% is in line compared to the rest of the industry. KMX outperforms 54.92% of its industry peers.
Looking at the Return On Equity, with a value of 7.55%, KMX is in the better half of the industry, outperforming 63.11% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 0.49%, KMX is in line with its industry, outperforming 40.16% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for KMX is significantly below the industry average of 12.24%.

		Industry Rank	Sector Rank
ROA	1.79%
ROE	7.55%
ROIC	0.49%

ROA(3y)1.81%

ROA(5y)2.66%

ROE(3y)8.18%

ROE(5y)12.73%

ROIC(3y)0.57%

ROIC(5y)1.15%

1.3 Margins

KMX's Profit Margin of 1.77% is in line compared to the rest of the industry. KMX outperforms 59.02% of its industry peers.
KMX's Profit Margin has declined in the last couple of years.
The Operating Margin of KMX (0.59%) is comparable to the rest of the industry.
In the last couple of years the Operating Margin of KMX has declined.
KMX's Gross Margin of 11.06% is on the low side compared to the rest of the industry. KMX is outperformed by 90.16% of its industry peers.
KMX's Gross Margin has declined in the last couple of years.

		Industry Rank	Sector Rank
OM	0.59%
PM (TTM)	1.77%
GM	11.06%

OM growth 3Y-30.89%

OM growth 5Y-27.28%

PM growth 3Y-19.26%

PM growth 5Y-15.36%

GM growth 3Y2.19%

GM growth 5Y-3.87%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

KMX has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
KMX has less shares outstanding than it did 1 year ago.
KMX has less shares outstanding than it did 5 years ago.
KMX has a better debt/assets ratio than last year.

2.2 Solvency

Based on the Altman-Z score of 1.57, we must say that KMX is in the distress zone and has some risk of bankruptcy.
With a Altman-Z score value of 1.57, KMX is not doing good in the industry: 63.93% of the companies in the same industry are doing better.
The Debt to FCF ratio of KMX is 8.99, which is on the high side as it means it would take KMX, 8.99 years of fcf income to pay off all of its debts.
KMX has a Debt to FCF ratio (8.99) which is comparable to the rest of the industry.
A Debt/Equity ratio of 2.76 is on the high side and indicates that KMX has dependencies on debt financing.
The Debt to Equity ratio of KMX (2.76) is worse than 72.13% of its industry peers.

		Industry Rank	Sector Rank
Debt/Equity	2.76
Debt/FCF	8.99
Altman-Z	1.57

ROIC/WACC0.11

WACC4.41%

2.3 Liquidity

KMX has a Current Ratio of 1.99. This is a normal value and indicates that KMX is financially healthy and should not expect problems in meeting its short term obligations.
KMX has a better Current ratio (1.99) than 79.51% of its industry peers.
A Quick Ratio of 0.51 indicates that KMX may have some problems paying its short term obligations.
With a Quick ratio value of 0.51, KMX perfoms like the industry average, outperforming 49.18% of the companies in the same industry.

		Industry Rank	Sector Rank
Current Ratio	1.99
Quick Ratio	0.51

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

KMX shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 4.75%.
Measured over the past years, KMX shows a decrease in Earnings Per Share. The EPS has been decreasing by -9.31% on average per year.
The Revenue has decreased by -0.15% in the past year.
Measured over the past years, KMX shows a small growth in Revenue. The Revenue has been growing by 5.34% on average per year.

EPS 1Y (TTM)4.75%

EPS 3Y-22.26%

EPS 5Y-9.31%

EPS Q2Q%-46.91%

Revenue 1Y (TTM)-0.15%

Revenue growth 3Y-6.17%

Revenue growth 5Y5.34%

Sales Q2Q%-6.9%

3.2 Future

Based on estimates for the next years, KMX will show a very strong growth in Earnings Per Share. The EPS will grow by 24.00% on average per year.
The Revenue is expected to grow by 1.32% on average over the next years.

EPS Next Y-18.42%

EPS Next 2Y-12.58%

EPS Next 3Y-2.46%

EPS Next 5Y24%

Revenue Next Year-2.77%

Revenue Next 2Y-1.21%

Revenue Next 3Y-0.09%

Revenue Next 5Y1.32%

3.3 Evolution

The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.

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4. Valuation

4.1 Price/Earnings Ratio

Based on the Price/Earnings ratio of 14.61, the valuation of KMX can be described as correct.
Based on the Price/Earnings ratio, KMX is valued a bit cheaper than the industry average as 77.87% of the companies are valued more expensively.
KMX's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 27.25.
A Price/Forward Earnings ratio of 18.06 indicates a rather expensive valuation of KMX.
KMX's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. KMX is cheaper than 68.03% of the companies in the same industry.
KMX is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 25.98, which is the current average of the S&P500 Index.

		Industry Rank	Sector Rank
PE	14.61
Fwd PE	18.06

4.2 Price Multiples

KMX's Enterprise Value to EBITDA ratio is a bit more expensive when compared to the industry. KMX is more expensive than 67.21% of the companies in the same industry.
KMX's Price/Free Cash Flow ratio is rather cheap when compared to the industry. KMX is cheaper than 98.36% of the companies in the same industry.