CarMax (KMX) reported earnings on Tue 21 June 2016 (b/o)

** charts after earnings **

  

 CarMax misses by $0.02, misses on revs :

• Reports Q1 (May) earnings of $0.90 per share, $0.02 worse than the Capital IQ Consensus of $0.92; revenues rose 2.8% year/year to $4.13 bln vs the $4.2 bln Capital IQ Consensus. 
• Total used vehicle unit sales grew 4.0% and comparable store used unit sales rose 0.2% [vs ests near +0.7%] Y/Y. The comparable store sales performance reflected the combination of an improvement in conversion that more than offset a decrease in store traffic. Our sales performance included a reduction in the Tier 3 sales mix to 11.9% of used unit sales from 14.7% in the prior year's first quarter. Tier 3 sales represent those financed by our Tier 3 third-party finance providers (those to whom we pay a fee) and those in CAF's Tier 3 loan origination program. For the non-Tier 3 customer base, comparable store used unit sales rose 3.6%.
• Wholesale vehicle unit sales grew 1.8% versus the first quarter of fiscal 2016, primarily driven by the growth in our store base.
• Total gross profit increased 5.3% versus last year's first quarter, to $572.6 million. Used vehicle gross profit rose 4.1%, driven by the 4.0% increase in total used unit sales. Used vehicle gross profit per unit was consistent at $2,202 versus $2,200 in the prior year period. Wholesale vehicle gross profit declined 1.9% versus the prior year's quarter, as the 1.8% increase in wholesale unit sales was offset by a decrease in wholesale vehicle gross profit per unit to $995 from $1,032.