CarMax Profit Rises 15%; Shares Jump
CarMax, the nation's largest retailer of used cars, posted a 15 percent rise in quarterly profit Wednesday, helped by increased traffic in its stores and on its Web site.
CarMax earned $65.4 million, or 30 cents per share, in the fiscal first quarter ended May 31, up from $56.8 million, or 27 cents per share, a year earlier.
Analysts were expecting earnings of 30 cents per share, according to Reuters Estimates.
Revenue increased 14 percent to $2.15 billion.
"Comparable-store used (vehicle) sales growth of 6 percent kicked off another good first quarter and what we are confident will be another year of growth for CarMax," Tom Folliard, president and chief executive, said in a statement.
The company's shares were up $2.55, or 11 percent, to $25.74 in morning trade on the New York Stock Exchange.
Wholesale vehicle sales increased 7 percent in the first quarter, and the average gross profit per vehicle on retail sales was slightly higher than a year ago, the company said.
CarMax said it continued to gain share in the late-model used vehicle market.
The company reiterated that it expects comparable-store used unit sales growth of 3 percent to 9 percent for the full year, and earnings of $1.03 to $1.14 per share.
Wall Street analysts expect the company to earn $1.07 per share for the full year, according to Reuters Estimates.