CarMax (KMAX), the used vehicle retailer, crushed Q3 earnings and revenues estimates indicating the rise in demand and pricing for used cars. CarMax stocks rose sharply in the pre-market trade but fell as the day progressed.
The EPS (Earnings Per share) for the Carmax stock was estimated to remain at $1.45, rising 2%, but earnings climbed 15% to $1.63. The analysts estimated the revenue to stay at $7,378 billion, which was reported to be $8.5 billion.
The average used-vehicle price was reported to rise 31% to $27,995. Similarly, SG&A expenses increased by 33.7% to $575.9 million compared to last year. Same store-unit sales rose by 15.8%.
CarMax crushing the estimates showed the growth in demand for the online offerings in the Pandemic, which drove the third-quarter earnings. The company also reported higher inventory and staffing levels and sourcing the vehicles from consumers.
The stock price for CarMax (KMAX) surged after the earnings were reported. However, as the day progressed, the stock prices fell considerably.
At the time of writing, CarMax (KMAX) traded at $130.19, down 6.80 points (-4.96%).