CarMax anticipates an improvement in comparable sales for the fourth quarter, signaling an acceleration in performance in December compared to the third quarter. During a conference call, Chief Executive Bill Nash communicated to analysts that the used car retailer expects stronger comparable sales on a sequential basis.
This optimism comes in light of certain challenges, including the absence of a Saturday in the fourth quarter. "We feel good about the trajectory of sales," Nash stated. Subsequently, shares of CarMax experienced a 3.3% increase in afternoon trading. For the three-month period ending November 30, revenue rose to $6.22 billion from $6.15 billion year-over-year, surpassing the average analyst estimate of $6.05 billion according to FactSet.
Used vehicle sales saw a notable increase of 1.2% to $4.89 billion, while the wholesale segment inched up by 0.3%. Retail used-vehicle sales volume has improved significantly, climbing 5.4% year over year, with comparable unit sales rising by 4.3%. Additionally, wholesale volume grew by 6.3%. Earnings per share also showed positive growth, rising to $0.81 from $0.52 a year ago. Nash acknowledged that while some consumers are still facing challenges, the company has effectively worked to streamline the sales process, enhancing customer conversion rates.
Furthermore, the US Federal Reserve has slightly cut interest rates by 1 percentage point since September, possibly aiding consumers in their purchasing decisions..