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CarMaxLTS:0HTQ -3.81%69 Return-on-Tangible-Equity is 12.37% as of May. 2026, which is 37% below its 10-year median of 19.52. GuruFocus rates LTS:0HTQ with a GF Score™ of 69/100 and a GF Value™ of $76.63 (Modestly Undervalued). The stock has 8 warning signs investors should review. Among 1,282 Vehicles & Parts companies, CarMax ranks worse than 66.22% on this metric.
Return-on-Tangible-Equity is calculated as Net Income divided by its average total shareholder tangible equity. Total shareholder tangible equity equals to Total Stockholders Equity minus Intangible Assets. CarMax's annualized net income for the quarter that ended in May. 2026 was $743 Mil. CarMax's average shareholder tangible equity for the quarter that ended in May. 2026 was $6,004 Mil. Therefore, CarMax's annualized Return-on-Tangible-Equity for the quarter that ended in May. 2026 was 12.37%.
The historical rank and industry rank for CarMax's Return-on-Tangible-Equity or its related term are showing as below:
LTS:0HTQ'
s Return-on-Tangible-Equity Range Over the Past 10 Years
Min: 3.69 Med: 19.52 Max: 25.25
Current: 3.69
During the past 13 years, CarMax's highest Return-on-Tangible-Equity was 25.25%. The lowest was 3.69%. And the median was 19.52%.
LTS:0HTQ's Return-on-Tangible-Equity is ranked worse than 66.22% of 1282
companies
in the Vehicles & Parts industry
Industry Median: 7.59
vs LTS:0HTQ: 3.69
Return-on-Tangible-Equity measures the rate of return on the ownership interest (shareholder's tangible equity) of the common stock owners. It measures a firm's efficiency at generating profits from every unit of shareholders' tangible equity (shareholders equity minus intangibles). Return-on-Tangible-Equity shows how well a company uses investment funds to generate earnings growth. Return-on-Tangible-Equitys between 15% and 20% are considered desirable.
Be Aware
Net Income is used.
Because a company can increase its Return-on-Tangible-Equity by having more financial leverage, it is important to watch the leverage ratio when investing in high Return-on-Tangible-Equity companies. Like Return-on-Tangible-Asset, Return-on-Tangible-Equity is calculated with only 12 months data. Fluctuations in company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective.
Asset light businesses require very few assets to generate very high earnings. Their Return-on-Tangible-Equitys can be extremely high.
CarMax Return-on-Tangible-Equity Related Terms
CarMax Return-on-Tangible-Equity Historical Data
* Premium members only.
The historical data trend for CarMax's Return-on-Tangible-Equity 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.
LTS:0HTQ vs ALTB, LAD, AN: Return-on-Tangible-Equity Comparison
For the Auto & Truck Dealerships subindustry, CarMax's Return-on-Tangible-Equity, along with its competitors' market caps and Return-on-Tangible-Equity 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.
CarMax Return-on-Tangible-Equity vs Vehicles & Parts Industry
For the Vehicles & Parts industry and Consumer Cyclical sector, CarMax's Return-on-Tangible-Equity distribution charts can be found below:
* The bar in red indicates where CarMax's Return-on-Tangible-Equity falls into.
* 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.
In the calculation of annual Return-on-Tangible-Equity, the net income of the last fiscal year and the average total shareholder tangible equity over the fiscal year are used. In calculating the quarterly data,
the net income data used here is four times the quarterly (May. 2026) net income data.
Return-on-Tangible-Equity is displayed in the 10-year financial page.
What does a Return-on-Tangible-Equity of 12.37% mean?
CarMax (LTS:0HTQ) has a Return-on-Tangible-Equity of 12.37% as of May. 2026. Return on tangible equity is the ratio of current-period net income to average two-period tangible equity. View historical data on CarMax and its competitors. This is 37% below median its historical median of 19.52. Over the past decade, CarMax's Return-on-Tangible-Equity has ranged from 3.69 to 25.25. According to the industry distribution chart, CarMax ranks #849 out of 1282 companies in the Vehicles & Parts industry, placing it in the top 66.2%.
Is CarMax's Return-on-Tangible-Equity too high?
CarMax's current Return-on-Tangible-Equity of 12.37% is 37% below median its 10-year median of 19.52. Over the past 10 years, this metric has ranged from a low of 3.69 to a high of 25.25. The Vehicles & Parts industry median Return-on-Tangible-Equity is 7.59. CarMax's value of 12.37% is 63% above this industry median. Based on the distribution chart, CarMax ranks #849 out of 1282 companies in the Vehicles & Parts industry, which is below the industry midpoint. Overall, CarMax has a GF Score™ of 69/100 and is considered Modestly Undervalued, reflecting its overall financial health beyond just this single metric.
How does CarMax's Return-on-Tangible-Equity compare to ALTB and LAD?
According to the Vehicles & Parts industry distribution chart, CarMax ranks #849 out of 1282 companies for Return-on-Tangible-Equity. This places CarMax in the lower half of its industry. The industry median Return-on-Tangible-Equity is 7.59. CarMax's value of 12.37% is 63% above this benchmark. Historically, CarMax's own Return-on-Tangible-Equity has ranged from 3.69 to 25.25 over the past decade. While the company's 10-year median is 19.52 vs. the industry median of 7.59, CarMax has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Return-on-Tangible-Equity for a Vehicles & Parts company?
The median Return-on-Tangible-Equity among Vehicles & Parts companies is 7.59, based on 1,282 companies in the industry. Companies in the top quartile (top 25%) have a Return-on-Tangible-Equity significantly above this median, while those in the bottom quartile fall well below. However, Return-on-Tangible-Equity should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. CarMax's current Return-on-Tangible-Equity of 12.37% is 63% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Return-on-Tangible-Equity mean?
A high Return-on-Tangible-Equity can signal that a stock is expensive relative to its fundamentals. Return on tangible equity is the ratio of current-period net income to average two-period tangible equity. View historical data on CarMax and its competitors. For the Vehicles & Parts industry, the median Return-on-Tangible-Equity is 7.59 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. CarMax's current Return-on-Tangible-Equity is 12.37%, which is 37% below median its own 10-year median of 19.52. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is CarMax stock overvalued right now?
Based on GuruFocus' analysis, CarMax (LTS:0HTQ) is currently considered Modestly Undervalued. The stock's GF Value™ is $76.63, compared to a current price of $58.25 — trading 24% below its estimated fair value. The current Return-on-Tangible-Equity is 12.37%, which is 37% below median its 10-year median of 19.52 and 63% above the Vehicles & Parts industry median of 7.59. CarMax's overall GF Score™ is 69/100 with 8 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Return-on-Tangible-Equity calculated?
Return-on-Tangible-Equity is calculated from a company's financial statements. For CarMax (LTS:0HTQ), the current Return-on-Tangible-Equity is 12.37% as of May. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is CarMax (LTS:0HTQ) Overvalued in 2026?
Based on GuruFocus' analysis, CarMax stock appears to be undervalued.
The current stock price of $58.25 is trading 24% below its estimated GF Value™ of $76.63.
GuruFocus considers CarMax to be Modestly Undervalued.
Key valuation signals for LTS:0HTQ:
Return-on-Tangible-Equity: 12.37% (37% below median its 10-year median of 19.52)
GF Value™: $76.63 vs. price of $58.25 (24% below fair value)
Industry Position: 63% above the Vehicles & Parts median (#849 of 1282)
No single metric tells the full story. See the LTS:0HTQ stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
CarMax sells, finances, and services used and new cars through a chain of over about 260 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 were 80% of fiscal 2026 revenue and wholesale about 17%, with the remaining portion composed of extended service plans and repair. In fiscal 2026, the company retailed and wholesaled 780,684 and 538,203 used vehicles, respectively. CarMax is the largest used-vehicle retailer in the US, but still estimates that it had only about 3.6% US market share of vehicles zero to 10 years old in calendar 2025. CarMax is based in Richmond, Virginia.
69GF Score
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