CarMax (NYSE:KMX) Altman Z2-Score

: 1.84 (As of Today)

View and export this data going back to 1997. Start your Free Trial

CarMax has a Altman Z2-Score of 1.84, indicating it is in Grey Zones. This implies that CarMax is in some kind of financial stress. If it is below 1.81, the company may face bankrupcy risk.

The zones of discrimination were as such:

When Altman Z2-Score <= 1.1, it is in Distress Zones.
When Altman Z2-Score >= 2.6, it is in Safe Zones.
When Altman Z2-Score is between 1.1 and 2.6, it is in Grey Zones.

The historical rank and industry rank for CarMax's Altman Z2-Score or its related term are showing as below:

KMX' s Altman Z2-Score Range Over the Past 10 Years
Min: 1.64 Med: 1.82 Max: 2.59
Current: 1.84

During the past 13 years, CarMax's highest Altman Z2-Score was 2.59. The lowest was 1.64. And the median was 1.82.

CarMax Altman Z2-Score Historical Data

The historical data trend for CarMax's Altman Z2-Score 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

Altman Z2-Score

1.75

1.76

1.84

2.28

1.80

CarMax Quarterly Data
	Aug18	Nov18	Feb19	May19	Aug19	Nov19	Feb20	May20	Aug20	Nov20	Feb21	May21	Aug21	Nov21	Feb22	May22	Aug22	Nov22	Feb23	May23
Altman Z2-Score																2.09	1.99	1.80	1.80	1.84

Competitive Comparison

For the Auto & Truck Dealerships subindustry, CarMax's Altman Z2-Score, along with its competitors' market caps and Altman Z2-Score 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 Altman Z2-Score Distribution

For the Vehicles & Parts industry and Consumer Cyclical sector, CarMax's Altman Z2-Score distribution charts can be found below:

* The bar in red indicates where CarMax's Altman Z2-Score falls in comparison to its industry or sector. The grey bar indicates the Altman Z2-Score's extreme value range as defined by GuruFocus.

CarMax Altman Z2-Score Calculation

Altman Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.

Z2-Score, also known as Z"-Score is the Z-Score for non-manufacturing companies excluding property/financial companies.

CarMax's Altman Z2-Score for today is calculated with this formula:

6.56

3.26

6.72

1.05

X4_2

6.56

0.1205

3.26

0.1466

6.72

0.042

1.05

0.2755

1.84

Trailing Twelve Months (TTM) ended in May. 2023:
Total Assets was $26,962 Mil.
Total Current Assets was $5,364 Mil.
Total Current Liabilities was $2,114 Mil.
Retained Earnings was $3,951 Mil.
Pre-Tax Income was 307.24 + 82.634 + 49.993 + 167.575 = $607 Mil.
Interest Expense was -173.066 + -138.928 + -118.95 + -95.245 = $-526 Mil.
Total Liabilities was $21,139 Mil.

* Note that for stock reported semi-annually or annually, GuruFocus uses latest annual data as the TTM data.

X1	=	Working Capital	/	Total Assets
	=	(Total Current Assets - Total Current Liabilities)	/	Total Assets
	=	(5363.668 - 2113.971)	/	26962.356
	=	0.1205

X2	=	Retained Earnings	/	Total Assets
	=	3951.392	/	26962.356
	=	0.1466

X3	=	Earnings Before Interest and Taxes	/	Total Assets
	=	(Pre-Tax Income - Interest Expense)	/	Total Assets
	=	(607.442 - -526.189)	/	26962.356
	=	0.042

X4_2	=	Net Worth	/	Total Liabilities
	=	(Total Stockholders Equity - Preferred Stock)	/	Total Liabilities
	=	(5823.168 - 0)	/	21139.188
	=	0.2755

The zones of discrimination were as such:

Distress Zones - 1.1 < Grey Zones < 2.6 - Safe Zones

CarMax has a Altman Z2-Score of 1.84 indicating it is in Grey Zones.

CarMax (NYSE:KMX) Altman Z2-Score Explanation

The original Z-Score model was based on publicly traded manufacturing companies while the Z2-Score, also known as Z"-score can be used for any type of company excluding property/financial companies. Both Z-Score and Z2-Score describes the financial health of a company, and its likelihood of financial distress.

X1: The Working Capital/Total Assets (WC/TA) ratio is a measure of the net liquid assets of the firm relative to the total capitalization. Working capital is defined as the difference between current assets and current liabilities. Ordinarily, a firm experiencing consistent operating losses will have shrinking current assets in relation to total assets. Altman found this one proved to be the most valuable liquidity ratio comparing with the current ratio and the quick ratio. This is however the least significant of the five factors.

X2: Retained Earnings/Total Assets: the RE/TA ratio measures the leverage of a firm. Retained earnings is the account which reports the total amount of reinvested earnings and/or losses of a firm over its entire life. Those firms with high RE, relative to TA, have financed their assets through retention of profits and have not utilized as much debt.

X3, Earnings Before Interest and Taxes/Total Assets (EBIT/TA): This ratio is a measure of the true productivity of the firm's assets, independent of any tax or leverage factors. Since a firm's ultimate existence is based on the earning power of its assets, this ratio appears to be particularly appropriate for studies dealing with corporate failure. This ratio continually outperforms other profitability measures, including cash flow.

X4_2, Net Worth (Total Stockholders Equity - Preferred Stock)/Total Liabilities (NW/TL): it compares a company’s stock net worth with its total liabilities and can be used to assess the extent of its reliance on debt.

Be Aware

Altman Z2-Score does not apply to financial companies.

CarMax Altman Z2-Score Related Terms

Thank you for viewing the detailed overview of CarMax's Altman Z2-Score 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 » Altman Z2-Score

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