Chris Pierce, an analyst from Needham, reiterated the Buy rating on CarMax (KMX – Research Report). The associated price target was lowered to $92.00.
Chris Pierce has given his Buy rating due to a combination of factors, including the potential benefits CarMax stands to gain from an improving used vehicle market. The company is well-positioned to leverage its investments in omni-channel capabilities, which could enhance its competitive edge.
Despite some macroeconomic concerns, such as rising average selling prices for used vehicles and fears of demand destruction similar to that seen in 2022, Pierce believes these challenges are unlikely to have a significant negative impact. The revised price target of $92 reflects a valuation that considers projected earnings growth while offering a margin of safety compared to more growth-oriented peers.
Pierce covers the Consumer Cyclical sector, focusing on stocks such as Sonic Automotive, Blue Bird, and CarMax. According to TipRanks, Pierce has an average return of -24.0% and a 25.15% success rate on recommended stocks.