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America's Car-Mart (CRMT)
NASDAQ:CRMT
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America's Car-Mart
(NASDAQ:CRMT)
60Neutral
Positive Factors
Earnings
The earnings per share beat consensus by 47%, driven primarily by lower expenses in credit provisions, interest, and depreciation & amortization.
Market Position
Incremental market share gain is expected, with competition recently pulling back amid macro concerns.
Sales Performance
Significant improvements to sales per store per month, up 13% year over year and 10% better than consensus.
Negative Factors
Operational Efficiency
Many of Car-Mart's operations being manual indicates that Car-Mart is behind its peers.
Stock Performance
Car-Mart shares have declined 23% over the past month.
America's Car-Mart (CRMT) vs. S&P 500 (SPY)
Market Cap
$376.74M
Dividend YieldN/A
Average Volume (3M)113.38K
Price to Earnings (P/E)50.7
Beta (1Y)1.96
Revenue Growth-2.26%
EPS GrowthN/A
CountryUS
Employees2,280
SectorConsumer Cyclical
Sector Strength51
IndustryAuto - Dealerships
Share Statistics
EPS (TTM)0.90
Shares Outstanding8,261,869
10 Day Avg. Volume68,223
30 Day Avg. Volume113,380
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.28
Price to Cash Flow (P/CF)-3.20
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$51.00Price Target Upside11.84% Upside
Rating ConsensusHold
Number of Analyst Covering2
America's Car-Mart Business Overview & Revenue Model
Company DescriptionAmerica's Car-Mart, Inc., through its subsidiaries, operates as an automotive retailer in the United States. It primarily sells older model used vehicles and provides financing for its customers. As of April 30, 2022, the company operated 154 dealerships in the South-Central United States. The company was founded in 1981 and is based in Rogers, Arkansas.
How the Company Makes MoneyAmerica's Car-Mart generates revenue primarily through the sale of used vehicles and the provision of financing solutions to its customers. The company operates a 'buy here, pay here' model, allowing it to sell cars and offer financing directly to customers. This integrated approach enables Car-Mart to earn interest income on the loans it provides. Additionally, the company benefits from repeat business and customer referrals, as well as vehicle service and repair operations that complement its sales activities. The revenue model is heavily reliant on interest income from financing, which is a significant contributor to the company's earnings.
America's Car-Mart Financial Statement Overview
Summary
America's Car-Mart shows a mixed financial position. The income statement reflects declining revenue and margins, highlighting challenges in profitability and growth. The balance sheet is strong with no debt and a good equity ratio, but low return on equity suggests inefficiencies. Cash flow has improved with positive free cash flow, but profitability remains a concern.Income Statement
The company has seen a decline in revenue from the previous annual period, indicating challenges in growth. The gross profit margin for TTM (Trailing-Twelve-Months) stands at 38.35%, which is healthy but has decreased from prior years. The net profit margin for TTM is relatively low at 0.27%, reflecting limited profitability. EBIT and EBITDA margins have also declined, showing reduced operational efficiency.65
Positive
Balance Sheet
The balance sheet shows a strong equity position with an equity ratio of 34.7% in TTM, suggesting a stable financial structure. The company has no debt in TTM, which minimizes financial risk. However, the return on equity is low at 0.64% in TTM, indicating inefficient use of equity to generate profits.75
Positive
Cash Flow
The company has managed to generate positive free cash flow in TTM, a significant improvement from previous negative values. However, the free cash flow to net income ratio is high due to low net income levels. Operating cash flow to net income ratio is solid at 7.88, indicating strong cash generation relative to net income.70
Positive
| Breakdown | |||||
| TTM | Jun 2024 | Jun 2023 | Jun 2022 | Jun 2021 | Jun 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 1.32B | 1.39B | 1.41B | 1.21B | 918.61M | 744.61M | Gross Profit |
| 507.43M | 628.48M | 599.63M | 548.73M | 439.46M | 356.14M | EBIT |
| 42.71M | 25.65M | 64.47M | 131.47M | 141.22M | 72.29M | EBITDA |
| 89.41M | 32.08M | 69.71M | 137.59M | 144.98M | 76.24M | Net Income Common Stockholders |
| 6.74M | -31.39M | 20.43M | 95.01M | 104.82M | 51.34M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 226.00K | 5.52M | 9.80M | 6.92M | 2.89M | 59.56M | Total Assets |
| 269.20M | 1.48B | 1.42B | 1.15B | 822.16M | 667.32M | Total Debt |
| 51.21M | 818.70M | 638.60M | 502.14M | 290.61M | 278.38M | Net Debt |
| 50.99M | 813.18M | 628.80M | 495.22M | 287.72M | 218.82M | Total Liabilities |
| 88.30M | 1.01B | 1.12B | 675.95M | 415.66M | 364.56M | Stockholders Equity |
| 180.90M | 471.05M | 297.42M | 469.37M | 406.50M | 302.76M |
| Cash Flow | Free Cash Flow | ||||
| 21.09M | -80.04M | -160.21M | -135.19M | -62.76M | 15.49M | Operating Cash Flow |
| 28.20M | -73.90M | -137.97M | -114.28M | -53.81M | 20.92M | Investing Cash Flow |
| -14.43M | -10.64M | -25.33M | -22.24M | -8.26M | -9.89M | Financing Cash Flow |
| 122.39M | 110.96M | 188.75M | 176.22M | 5.40M | 46.78M |
America's Car-Mart Technical Analysis
Negative
45.60
Price Trends
46.82
Negative
47.36
Negative
50.80
Negative
Market Momentum
0.31
Negative
46.49
Neutral
26.65
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CRMT, the sentiment is Negative. The current price of 45.6 is above the 20-day moving average (MA) of 45.59, below the 50-day MA of 46.82, and below the 200-day MA of 50.80, indicating a bearish trend. The MACD of 0.31 indicates Negative momentum. The RSI at 46.49 is Neutral, neither overbought nor oversold. The STOCH value of 26.65 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CRMT.
America's Car-Mart Risk Analysis
America's Car-Mart disclosed 18 risk factors in its most recent earnings report. America's Car-Mart reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
America's Car-Mart Peers Comparison
Overall Rating
UnderperformOutperform
Sector (59)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | $7.62B | 9.80 | 12.47% | 0.72% | 16.75% | -18.09% | |
69 Neutral | $4.90B | 10.21 | 17.23% | 0.50% | 11.53% | -13.75% | |
63 Neutral | $6.24B | 9.56 | 29.65% | ― | -0.68% | -25.24% | |
62 Neutral | $11.69B | 26.50 | 7.52% | ― | -2.46% | -6.19% | |
60 Neutral | $376.74M | 50.68 | 1.50% | ― | -2.26% | ― | |
60 Neutral | $1.87B | 8.93 | 22.11% | 2.27% | -1.03% | 24.64% | |
59 Neutral | $12.24B | 11.04 | -1.00% | 3.78% | 1.30% | -19.54% |
* Consumer Cyclical Sector Average
Performance Comparison
CRMT
America's Car-Mart
45.39
-17.28
-27.57%
AN
AutoNation
161.92
-2.84
-1.72%
KMX
CarMax
77.92
-8.02
-9.33%
GPI
Group 1 Automotive
381.95
93.91
32.60%
LAD
Lithia Motors
293.54
-0.15
-0.05%
SAH
Sonic Automotive
56.96
2.01
3.66%
America's Car-Mart Earnings Call Summary
Earnings Call Date: Mar 6, 2025 | % Change Since: 18.87% | Next Earnings Date: May 26, 2025
Earnings Call Sentiment Positive
The earnings call highlighted several positive developments, including increased revenue, sales volume growth, and successful capital transactions. However, challenges such as rising delinquencies, increased SG&A expenses, and a difficult customer environment were noted. The company's strategic investments and leadership additions position it well for future growth.Highlights
Revenue Increase
Total revenue increased by 8.7% despite average selling prices declining by 90 basis points. Higher sales volume and a 5.1% increase in interest income were primary drivers.
Sales Volume Growth
Sales volumes were up 13.2% for the quarter, driven by the acceleration of the annual tax season promotion and improved lead management.
Gross Margin Improvement
Gross margin improved to 35.7% from 34.2% in the prior year, aided by better vehicle procurement and disposal practices.
Improved Net Charge-offs
Net charge-offs as a percentage of average finance receivables improved to 6.1% from 6.8% in the prior year.
Successful Capital Transactions
Completed an extension and upsizing of the ABL facility to $350 million and a $200 million ABS transaction, improving capital structure.
Leadership Additions
Hired Sam Smith as Vice President of Capital Markets and Treasury and Josh Smith as Chief Technology Officer, bringing extensive experience to the team.
Lowlights
Delinquencies Increase
Accounts over 30 days past due increased by 40 basis points to 3.7% at quarter-end, attributed to winter weather impacts.
SG&A Expense Increase
SG&A expenses increased by $2.9 million or 6.7%, primarily driven by acquisitions and higher stock compensation.
Challenging Customer Environment
Persistent inflationary trends, higher used car prices, and elevated interest rates present ongoing challenges for customers.
Company Guidance
During America's Car-Mart's third quarter fiscal 2025 earnings call, the company provided several key metrics and updates. The ABL facility was extended and upsized to $350 million, maturing in March 2027, while a $200 million ABS transaction was completed with a weighted average life-adjusted coupon of 6.49%, representing a 95 basis point improvement. Sales volumes increased by 13.2%, driven by an early tax season promotion, despite a 90 basis point decline in average selling prices. Gross margin improved to 35.7% from 34.2%. Delinquencies rose by 40 basis points to 3.7% by quarter-end, yet improved post-January. Net charge-offs improved to 6.1%, down from 6.8% in the prior year. Additionally, SG&A expenses increased by 6.7% due to acquisitions and compensation, while interest expense rose slightly by $192,000. Overall, the company noted enhancements from its loan origination system and focused on maintaining quality credit in a challenging environment.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.