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CarMax Sloan Ratio %

: 13.05% (As of Aug. 2021)
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Richard Sloan from the University of Michigan was first to document what is referred to as the "accrual anomaly". His 1996 paper found that shares of companies with small or negative accruals vastly outperform (+10%) those of companies with large ones.

CarMax's Sloan Ratio for the quarter that ended in Aug. 2021 was 13.05%.

As of Aug. 2021, CarMax has a Sloan Ratio of 13.05%, indicating there is a warning stage of accrual build up.


CarMax Sloan Ratio % Historical Data

The historical data trend for CarMax's Sloan Ratio % 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 Feb12 Feb13 Feb14 Feb15 Feb16 Feb17 Feb18 Feb19 Feb20 Feb21
Sloan Ratio %
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 9.23 5.98 5.28 7.18 0.96

CarMax Quarterly Data
Nov16 Feb17 May17 Aug17 Nov17 Feb18 May18 Aug18 Nov18 Feb19 May19 Aug19 Nov19 Feb20 May20 Aug20 Nov20 Feb21 May21 Aug21
Sloan Ratio % Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 1.01 1.23 0.96 8.75 13.05

Competitive Comparison

For the Auto & Truck Dealerships subindustry, CarMax's Sloan Ratio %, along with its competitors' market caps and Sloan Ratio % 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 Sloan Ratio % Distribution

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

* The bar in red indicates where CarMax's Sloan Ratio % falls into.



CarMax Sloan Ratio % Calculation

Earnings contain a lot of non cash earnings which is called accruals. The Sloan ratio is a way to identify firms with low non-cash or accrual-derived earnings relative to their cash flow.

CarMax's Sloan Ratio for the fiscal year that ended in Feb. 2021 is calculated as

Sloan Ratio=(Net Income (A: Feb. 2021 )-Cash Flow from Operations (A: Feb. 2021 )
-Cash Flow from Investing (A: Feb. 2021 ))/Total Assets (A: Feb. 2021 )
=(746.919-667.76
--128.183)/21541.541
=0.96%

CarMax's Sloan Ratio for the quarter that ended in Aug. 2021 is calculated as

Sloan Ratio=(Net Income (TTM)-Cash Flow from Operations (TTM})
-Cash Flow from Investing (TTM))/Total Assets (Q: Aug. 2021 )
=(1167.268--1607.337
--416.062)/24453.322
=13.05%

CarMax's Net Income for the trailing twelve months (TTM) ended in Aug. 2021 was 235.3 (Nov. 2020 ) + 209.945 (Feb. 2021 ) + 436.756 (May. 2021 ) + 285.267 (Aug. 2021 ) = $1,167 Mil.
CarMax's Cash Flow from Operations for the trailing twelve months (TTM) ended in Aug. 2021 was -21.39 (Nov. 2020 ) + -200.626 (Feb. 2021 ) + -111.883 (May. 2021 ) + -1273.438 (Aug. 2021 ) = $-1,607 Mil.
CarMax's Cash Flow from Investing for the trailing twelve months (TTM) ended in Aug. 2021 was -29.719 (Nov. 2020 ) + -6.107 (Feb. 2021 ) + -63.143 (May. 2021 ) + -317.093 (Aug. 2021 ) = $-416 Mil.

* 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.


CarMax  (NYSE:KMX) Sloan Ratio % Explanation

A former University of Michigan researcher, Richard Sloan's 1996 paper found that shares of companies with small or negative accruals vastly outperform (+10%) those of companies with large ones. In fact, for the 40-year period between 1962 and 2001, buying the lowest accrual companies and shorting the highest accrual companies resulted in an average annual compounded return of 18%, more than double the S&P 500's 7.4% annual return over the same period.

According to How to Beat the Market with the Sloan Ratio:

If the Sloan Ratio is between -10% and 10%, the company is in the safe zone and there is no funny business with accruals.

If the Sloan Ratio is less than between -25% and -10% on the negative side, and between 10% and 25% on the positive side, this is a warning stage of accrual build up.

If the Sloan Ratio is less than -25% or greater than 25%, and this ratio is consistent over several quarters or even years, be careful. Earnings are highly likely to be made up of accruals.

As of Aug. 2021, CarMax has a Sloan Ratio of 13.05%, indicating there is a warning stage of accrual build up.


CarMax Sloan Ratio % Related Terms

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


CarMax Business Description

CarMax logo
Industry
Consumer Cyclical » Vehicles & Parts NAICS : 423110 SIC : 5521
Traded in Other Exchanges
Address
12800 Tuckahoe Creek Parkway, Richmond, VA, USA, 23238
CarMax sells, finances, and services used and new cars through a chain of 220 used retail stores at the end of fiscal 2021 plus one new vehicle store. It was formed in 1993 as a unit of Circuit City and spun off into an independent company in late 2002. Used-vehicle sales account for about 83% of revenue, wholesale about 14%, and the remaining portion is composed of extended service plans and repair. In fiscal 2021, the company retailed and wholesaled 751,862 and 426,268 used vehicles, respectively. CarMax is the largest used vehicle retailer in the U.S., but still estimates that it has only about 3.5% U.S. market share of vehicles 0 to 10 years old but seeks over 5% by the end of calendar 2025. CarMax is based in Richmond, Virginia.
Executives
Oneil Mark F director C/O CARMAX, INC. 12800 TUCKAHOE CREEK PARKWAY RICHMOND VA 23238
Reedy Thomas W Jr officer: EVP of Finance 12800 TUCKHOE CREEK PARKWAY RICHMOND VA 23238
Margolin Eric M officer: EVP, Gen. Counsel & Secretary C/O ADVANCE AUTO PARTS 5673 AIRPORT RD ROANOKE VA 24012
Lyski James officer: EVP & Chief Marketing Officer ONE NATIONWIDE PLAZA 1-38-06 COLUMBUS OH 43215
Nash William D officer: President & CEO 12800 TUCKAHOE CREEK PARKWAY RICHMOND VA 23238
Daniels Jon G officer: SVP, CAF 12800 TUCKAHOE CREEK PARKWAY RICHMOND VA 23238
Folliard Thomas J director 4900 COX RD GELN ALLEN VA 23060
Livesay Jill A officer: VP, Controller & PAO CARMAX, INC. 12800 TUCKAHOE CREEK PARKWAY RICHMOND VA 23238
Cafritz Diane L officer: SVP & CHRO 12800 TUCKAHOE CREEK PARKWAY RICHMOND VA 23238
Hill Edwin J officer: EVP & COO 12800 TUCKAHOE CREEK PARKWAY RICHMOND VA 23238
Blaylock Ronald E director PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN"> Ownership Information: BLAYLOCK RONALD E a.header:link {color: #3b4fae; font-weight: bold; text-decoration: underline;} a.header:visited {color: #3b4fae; font-weight: bold; text-decoration: underline;} a.header:hover {color: #191970;}
Satriano Pietro director C/O US FOODS HOLDING CORP. 9399 W. HIGGINS RD., STE 100 ROSEMONT IL 60018
Shinder Marcella director 12800 TUCKAHOE CREEK PARKWAY RICHMOND VA 23238
Steenrod Mitchell D director 12800 TUCKAHOE CREEK PKWY RICHMOND VA 23238
Mccreight David W. director C/O URBAN OUTFITTERS, INC. 5000 SOUTH BROAD STREET PHILADELPHIA PA 19112

CarMax Headlines

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