CarMax, Inc. (KMX), headquartered in Richmond, Virginia, operates as a retailer of used vehicles and related products. With a market cap of $10.3 billion, the company offers used cars, vans, electric vehicles, and light trucks, as well as provides rental, maintenance, post warranty repairs, mechanical and painting work, diagnosis insurance, valuation, and security services. 

Shares of used car giant have underperformed the broader market over the past year. KMX has declined 7.9% over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 12.5%. In 2025, KMX stock is down 17.8%, compared to the SPX’s 1.3% rise on a YTD basis. 

Narrowing the focus, KMX’s underperformance is also apparent compared to the Consumer Discretionary Select Sector SPDR Fund (XLY). The exchange-traded fund has gained about 22.4% over the past year. Moreover, the ETF’s 3% dip on a YTD basis outshine the stock’s double-digit losses over the same time frame.

On Apr. 10, KMX shares closed down by 17% after reporting its Q4 results. Its EPS came in at $0.58, up 81.3% year over year. The company’s revenue was $6 billion, beating Wall Street forecasts of $5.99 billion. 

For fiscal 2026, ending in February 2026, analysts expect KMX’s EPS to grow 16.2% to $3.80 on a diluted basis. The company’s earnings surprise history is mixed. It beat or matched the consensus estimate in two of the last four quarters while missing the forecast on two other occasions.

Among the 17 analysts covering KMX stock, the consensus is a “Moderate Buy.” That’s based on eight “Strong Buy” ratings, two “Moderate Buys,” three “Holds,” one “Moderate Sell,” and three “Strong Sells.”

This configuration is less bullish than a month ago, with three analysts suggesting a “Moderate Buy,” and two recommend a “Strong Sell.” 

On Apr. 14, Morgan Stanley (MS) analyst Adam Jonas reiterated a “Buy” rating on KMX with a price target of $80, implying a potential upside of 19% from current levels.

The mean price target of $81.47 represents a 21.1% premium to KMX’s current price levels. The Street-high price target of $105 suggests an ambitious upside potential of 56.1%.