CarMax (NYSE:KMX) Asset Turnover

: 0.29 (As of May. 2023)

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Asset Turnover measures how quickly a company turns over its asset through sales. It is calculated as Revenue divided by Total Assets. CarMax's Revenue for the three months ended in May. 2023 was $7,687 Mil. CarMax's Total Assets for the quarter that ended in May. 2023 was $26,573 Mil. Therefore, CarMax's Asset Turnover for the quarter that ended in May. 2023 was 0.29.

Asset Turnover is linked to ROE % through Du Pont Formula. CarMax's annualized ROE % for the quarter that ended in May. 2023 was 15.97%. It is also linked to ROA % through Du Pont Formula. CarMax's annualized ROA % for the quarter that ended in May. 2023 was 3.44%.

CarMax Asset Turnover Historical Data

The historical data trend for CarMax's Asset Turnover 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

Asset Turnover

1.00

1.02

0.89

1.33

1.13

CarMax Quarterly Data
	Aug18	Nov18	Feb19	May19	Aug19	Nov19	Feb20	May20	Aug20	Nov20	Feb21	May21	Aug21	Nov21	Feb22	May22	Aug22	Nov22	Feb23	May23
Asset Turnover																0.35	0.31	0.25	0.22	0.29

Competitive Comparison

For the Auto & Truck Dealerships subindustry, CarMax's Asset Turnover, along with its competitors' market caps and Asset Turnover 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 Asset Turnover Distribution

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

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

CarMax Asset Turnover Calculation

Asset Turnover measures how quickly a company turns over its asset through sales.

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

	Asset Turnover
=	Revenue	/	Average Total Assets
=	Revenue (A: Feb. 2023 )	/	( (Total Assets (A: Feb. 2022 )	+	Total Assets (A: Feb. 2023 ))	/ count )
=	29684.873	/	( (26338.264	+	26182.736)	/ 2 )
=	29684.873	/	26260.5
=	1.13

CarMax's Asset Turnover for the quarter that ended in May. 2023 is calculated as

	Asset Turnover
=	Revenue	/	Average Total Assets
=	Revenue (Q: May. 2023 )	/	( (Total Assets (Q: Feb. 2023 )	+	Total Assets (Q: May. 2023 ))	/ count )
=	7687.063	/	( (26182.736	+	26962.356)	/ 2 )
=	7687.063	/	26572.546
=	0.29

Companies with low profit margins tend to have high Asset Turnover, while those with high profit margins have low Asset Turnover. Companies in the retail industry tend to have a very high turnover ratio.

CarMax (NYSE:KMX) Asset Turnover Explanation

Asset Turnover is linked to ROE % through Du Pont Formula.

CarMax's annulized ROE % for the quarter that ended in May. 2023 is

	ROE %^**		(Q: May. 2023 )
=	Net Income	/	Total Stockholders Equity
=	913.192	/	5718.1225
=	(Net Income / Revenue)	*	(Revenue / Total Assets)	*	(Total Assets / Total Stockholders Equity)
=	(913.192 / 30748.252)	*	(30748.252 / 26572.546)	*	(26572.546/ 5718.1225)
=	Net Margin %	*	Asset Turnover	*	Equity Multiplier
=	2.97 %	*	1.1571	*	4.6471
=	ROA %	*	Equity Multiplier
=	3.44 %	*	4.6471
=	15.97 %

Note: The Net Income data used here is four times the quarterly (May. 2023) net income data. The Revenue data used here is four times the quarterly (May. 2023) revenue data.

^** The ROE % used above is for Du Pont Analysis only. It is different from the defined ROE % page on our website, as here it uses Net Income instead of Net Income attributable to Common Stockholders in the calculation.

It is also linked to ROA % through Du Pont Formula:

CarMax's annulized ROA % for the quarter that ended in May. 2023 is

	ROA %		(Q: May. 2023 )
=	Net Income	/	Total Assets
=	913.192	/	26572.546
=	(Net Income / Revenue)	*	(Revenue / Total Assets)
=	(913.192 / 30748.252)	*	(30748.252 / 26572.546)
=	Net Margin %	*	Asset Turnover
=	2.97 %	*	1.1571
=	3.44 %

Note: The Net Income data used here is four times the quarterly (May. 2023) net income data. The Revenue data used here is four times the quarterly (May. 2023) revenue data.

Be Aware

In the article Joining The Dark Side: Pirates, Spies and Short Sellers, James Montier reported that In their US sample covering the period 1968-2003, Cooper et al find that firms with low asset growth outperformed firms with high asset growth by an astounding 20% p.a. equally weighted. Even when controlling for market, size and style, low asset growth firms outperformed high asset growth firms by 13% p.a. Therefore a company with fast asset growth may underperform.

Therefore, it is a good sign if a company's Asset Turnover is consistent or even increases. If a company's asset grows faster than sales, its Asset Turnover will decline, which can be a warning sign.

CarMax Asset Turnover Related Terms

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CarMax (NYSE:KMX) Business Description

Industry

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

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