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Oppenheimer Cuts CarMax To Hold, Softer Sales Could Cap Multiple

CarMax (KMX) reported better-than-expected second-quarter earnings Tuesday, but sales were light, and investors pushed the shares down for the day.


That was the right move, according to Oppenheimer’s Brian Nagel and Dan Farrell, who cut their rating on the shares from Outperform to Perform, with a $77 price target. They write that they still see CarMax as one of the most innovative business models in the space, and their long-term bull thesis is unchanged. However, they are concerned about the near-term outlook, given softer used car sales trends. These could...