Deutsche Bank Downgrades CarMax (KMX) to Hold
KMX Hot Sheet
Rating Summary:7 Buy, 4 Hold, 0 Sell
Rating Trend:
Down
Today's Overall Ratings:
Up: 16 | Down: 9 | New: 35
Deutsche Bank downgrades CarMax (NYSE: KMX) from Buy to Hold. Price target increased from $15 to $17.
Deutsche analyst says, "Although underlying earnings appear to be improving, risks include potential downside to GAAP earnings due to elimination of gain on sale accounting. Other downside risks: 1) Extended duration of depressed volume levels; 2) increased ABS spreads / benchmark rates; 3) Deterioration in loan losses. Upside risks: 1) Steeper volume recovery than expected; 2) further narrowing of ABS spreads...We are raising our FY2010 / FY2011 / FY2012 estimates to $0.57 / $0.85 / $1.15 from $0.38 / $0.64 / $1.00 based on our belief that KMX can sustain structurally higher gross margins."
CarMax, Inc. is a holding company and its operations are conducted through its subsidiaries.
Deutsche analyst says, "Although underlying earnings appear to be improving, risks include potential downside to GAAP earnings due to elimination of gain on sale accounting. Other downside risks: 1) Extended duration of depressed volume levels; 2) increased ABS spreads / benchmark rates; 3) Deterioration in loan losses. Upside risks: 1) Steeper volume recovery than expected; 2) further narrowing of ABS spreads...We are raising our FY2010 / FY2011 / FY2012 estimates to $0.57 / $0.85 / $1.15 from $0.38 / $0.64 / $1.00 based on our belief that KMX can sustain structurally higher gross margins."
CarMax, Inc. is a holding company and its operations are conducted through its subsidiaries.
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