CarMax, Inc (NYSE:KMX)’s Average Selling Prices of Used Vehicles rise 4.1%

Albany, New York (09/23/2014) – A company engaged in auto financing, and merchandising, CarMax, Inc (NYSE:KMX) said that it could realize better average selling prices for its used vehicles, as well as, wholesale vehicles in the second quarter. However, its average selling prices or ASP witnessed a downtrend in its new vehicles division.

ASP Rises

The company said that its used vehicles’ ASP grew 4.1% to $20,215 in the second quarter from $19,428 while its wholesale vehicles ASP advanced a similar 4.1% uptick to $5,249 from $5,044 in the prior year quarter, its statement indicated. However, the disappointment came from the new vehicles division, which recorded 1.2% fall in ASP to $26,991 from $27,313 in the previous year quarter.

As far as the vehicle sales changes, CarMax, Inc (NYSE:KMX) said that its used vehicle units accounted for 6.3% compared to 21.1% while, in terms revenue, it was 10.6% versus 20.4% in the prior year quarter. Similarly, its wholesale vehicle units represented 7.4% on top of 10.2% last year whereas, in revenue terms, it accounted for 11.7% compared to 8.7% in the year-ago quarter.

Unit Sales

The company said that its new vehicles units recorded an 18.0% growth to 2,581 from 2,187 vehicles while used vehicles advanced 6.3% to 143,325 from 134,854 vehicles. Its wholesale vehicles also registered an uptick of 7.4% to 97,989 vehicles from 91,243 in the previous year quarter.

2Q Results

CarMax, Inc (NYSE:KMX) reported net earnings of $154.52 million, up 10.2% from $149.27 million while earnings increased 12.9% to 70 cents a share from 62 cents a share in the prior year quarter. On average, street analysts estimated the company to earn 67 cents a share.

The company’s net sales and operating revenues advanced 11% to $3.6 billion from $3.25 billion in the year earlier quarter. Analysts’ predicted the company to deliver revenue of $3.57 billion.

While used vehicle sales grew 10.6% to $2.92 billion from $2.64 billion, new vehicle sales increased 16.6% to $69.94 million from $60.0 million. Its wholesale vehicle sales also advanced 11.7% to $530.27 million from $474.9 million in the previous year quarter.

CarMax, Inc (NYSE:KMX) said that it has bought back 4.0 million shares for $201.0 million during the second quarter. The company still has $907.8 million for the share buyback program.

CarMax attributed the results to its strong uptick in store base and improvements in its all divisions apart from its share buyback program.

About the Author

Erica is a graduate of New York University's school of Journalism. She joined US Markets Daily as a general assignment reporter in January of 2008.

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