) announced that its board of directors has approved a share
repurchase program worth $300 million. The authorization is
effective instantly and will expire on December 31, 2013.
The repurchase will take place either in open market or
privately. Meanwhile, the transaction is expected to comply with
Securities and Exchange Commission Rule 10b-18. With this share
repurchase program, the company seeks to enhance shareholders
value and achieve the targeted growth plan.
The company continues to focus on its plan of opening 10
superstores in fiscal 2013 and 10 to 15 superstores during each
of the three fiscal years after fiscal 2013. In the second
quarter of fiscal 2013, the company has opened three used car
superstores; two in Ft. Myers, Florida, and the other in
In the second quarter of fiscal 2013 (ended on August 31, 2012),
CarMax, reported a profit of $111.6 million, which was flat
compared to the prior year. The company's earnings of 48 cents
per share in the quarter missed the Zacks Consensus Estimate of
Net sales and operating revenues increased 6.6% year over year to
$2.76 billion, surpassing the Zacks Consensus Estimate of $2.74
billion. Used vehicle sales improved 8.8% to $2.2 billion due to
higher unit sales. Unit sales went up 8.3% to 111,316 vehicles
and average selling price marginally increased 0.4% to $19,494.
CarMax is one of the largest retailers of used vehicles. The
company pioneered the used car superstore concept with the
inauguration of its first store in 1993. It operated around 115
used car superstores in 57 markets as of October 18, 2012.
CarMax, which competes with
Penske Automotive Group
), maintains a Zacks #3 Rank, which translates into a short-term
(1 to 3 months) Hold rating. Currently, we have a long-term
Neutral recommendation on its shares.
AUTONATION INC (AN): Free Stock Analysis
CARMAX GP (CC) (KMX): Free Stock Analysis
PENSKE AUTO GRP (PAG): Free Stock Analysis
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