CarMax (NYSE:KMX) Interest Coverage

: 0 (At Loss) (As of Aug. 2023)

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Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income by its Interest Expense. CarMax's Operating Income for the three months ended in Aug. 2023 was $-38 Mil. CarMax's Interest Expense for the three months ended in Aug. 2023 was $-184 Mil. did not have earnings to cover the interest expense. The higher the ratio, the stronger the company's financial strength is.

The historical rank and industry rank for CarMax's Interest Coverage or its related term are showing as below:

KMX's Interest Coverage is not ranked ^*
in the Vehicles & Parts industry.
Industry Median: 7.48
* Ranked among companies with meaningful Interest Coverage only.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

CarMax Interest Coverage Historical Data

The historical data trend for CarMax's Interest Coverage can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

CarMax Annual Data

Trend

Feb14

Feb15

Feb16

Feb17

Feb18

Feb19

Feb20

Feb21

Feb22

Feb23

Interest Coverage

1.53

1.25

0.68

1.71

CarMax Quarterly Data
	Nov18	Feb19	May19	Aug19	Nov19	Feb20	May20	Aug20	Nov20	Feb21	May21	Aug21	Nov21	Feb22	May22	Aug22	Nov22	Feb23	May23	Aug23
Interest Coverage																-	-	-	0.56	-

Competitive Comparison

For the Auto & Truck Dealerships subindustry, CarMax's Interest Coverage, along with its competitors' market caps and Interest Coverage data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Annual Data Quarterly Data

CarMax Interest Coverage Distribution

For the Vehicles & Parts industry and Consumer Cyclical sector, CarMax's Interest Coverage distribution charts can be found below:

* The bar in red indicates where CarMax's Interest Coverage falls in comparison to its industry or sector. The grey bar indicates the Interest Coverage's extreme value range as defined by GuruFocus.

CarMax Interest Coverage Calculation

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

If Interest Expense is negative and Operating Income is positive, then

Interest Coverage

-1

Operating Income

Interest Expense

Else if Interest Expense is negative and Operating Income is negative, then

The company did not have earnings to cover the interest expense.

Else if Interest Expense is 0 and Long-Term Debt & Capital Lease Obligation is 0, then

The company had no debt.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

CarMax's Interest Coverage for the fiscal year that ended in Feb. 2023 is calculated as

Here, for the fiscal year that ended in Feb. 2023, CarMax's Interest Expense was $-431 Mil. Its Operating Income was $-311 Mil. And its Long-Term Debt & Capital Lease Obligation was $18,299 Mil.

CarMax did not have earnings to cover the interest expense.

CarMax's Interest Coverage for the quarter that ended in Aug. 2023 is calculated as

Here, for the three months ended in Aug. 2023, CarMax's Interest Expense was $-184 Mil. Its Operating Income was $-38 Mil. And its Long-Term Debt & Capital Lease Obligation was $18,601 Mil.

CarMax did not have earnings to cover the interest expense.

The higher the ratio, the stronger the company's Financial Strength is.

CarMax (NYSE:KMX) Interest Coverage Explanation

Ben Graham requires that a company has a minimum interest coverage of 5 with the companies he invested. If the interest coverage is less than 2, the company is burdened by debt. Any business slow or recession may drag the company into a situation where it cannot pay the interest on its debt.

Interest Coverage is an important factor when GuruFocus ranks a company's overage Financial Strength .

CarMax Interest Coverage Related Terms

Thank you for viewing the detailed overview of CarMax's Interest Coverage provided by GuruFocus.com. Please click on the following links to see related term pages.

CarMax (NYSE:KMX) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Cyclical » Vehicles & Parts » CarMax Inc (NYSE:KMX) » Definitions » Interest Coverage

Comparable Companies

Traded in Other Exchanges

KMX:Mexico XA4:Germany

Address

12800 Tuckahoe Creek Parkway, Richmond, VA, USA, 23238

Website

https://www.carmax.com

CarMax sells, finances, and services used and new cars through a chain of about 240 used retail stores. It was formed in 1993 as a unit of Circuit City and spun off into an independent company in late 2002. Used-vehicle sales typically account for about 83% of revenue (78% in fiscal 2023 due to the chip shortage) and wholesale about 13% (20% in fiscal 2023), with the remaining portion composed of extended service plans and repair. In fiscal 2023, the company retailed and wholesaled 807,823, and 585,071 used vehicles, respectively. CarMax is the largest used-vehicle retailer in the U.S. but still estimates that it has only about 4% U.S. market share of vehicles 0-10 years old in 2022. It seeks over 5% share by the end of calendar 2025. CarMax is based in Richmond, Virginia.

Executives

Enrique N Mayor-mora	officer: SVP & CFO	12800 TUCKAHOE CREEK PARKWAY, RICHMOND VA 23238
Mark F Oneil	director	C/O CARMAX, INC., 12800 TUCKAHOE CREEK PARKWAY, RICHMOND VA 23238
Pietro Satriano	director	C/O US FOODS HOLDING CORP., 9399 W. HIGGINS RD., STE 100, ROSEMONT IL 60018
David W. Mccreight	director	C/O URBAN OUTFITTERS, INC., 5000 SOUTH BROAD STREET, PHILADELPHIA PA 19112
Peter J Bensen	director	MCDONALD'S CORPORATION, 2915 JORIE BOULEVARD, OAK BROOK IL 60523
Robert J. Hombach	director	C/O BAXALTA INCORPORATED, 1200 LAKESIDE DRIVE, BANNOCKBURN IL 60015
Darren C Newberry	officer: SVP	12800 TUCKAHOE CREEK PARKWAY, RICHMOND VA 23238
Charles Joseph Wilson	officer: SVP	12800 TUCKAHOE CREEK PARKWAY, RICHMOND VA 23238
Sona Chawla	director	N56 W17000 RIDGEWOOD DRIVE, MENOMONEE FALLS WI 53051
Diane L Cafritz	officer: SVP & CHRO	12800 TUCKAHOE CREEK PARKWAY, RICHMOND VA 23238
Jill A Livesay	officer: VP, Controller & PAO	CARMAX, INC., 12800 TUCKAHOE CREEK PARKWAY, RICHMOND VA 23238
John T Standley	director
Alan B. Colberg	director	ASSURANT, INC., ONE CHASE MANHATTAN PLAZA, 41 FL., NEW YORK NY 10005
Marcella Shinder	director	12800 TUCKAHOE CREEK PARKWAY, RICHMOND VA 23238
Jon G Daniels	officer: SVP, CAF	12800 TUCKAHOE CREEK PARKWAY, RICHMOND VA 23238