June 22, 2018 — Carmax shares are up nearly 10% and more than $6.60 in pre-market trading this morning after being down $1.72 yesterday. The jump this morning is being fueled by a strong first (fiscal) quarter in which Carmax’s earnings per share of $1.33 beat expectations by $0.09 and overall revenue of $4.79 billion exceeding analyst expectations by $180 million.
The tax cut enacted by President Trump’s administration helped increase net earnings 2.7% to $238.7 million and net earnings per diluted share 17.7% to $1.33.
Revenue from vehicle sales jumped 4.6% to more than $4 billion while its 98,398 unit sales were up slightly.
Wholesale operations continues to be a strength for Carmax as its $1,012 gross profit per vehicle was up 9.6%. Overall, gross profit per vehicle was flat at $2,215. Also finance operations grew nearly 6% with revenue of $115.6 million for the quarter.
The used car retailer also provided a healthy return for shareholders buying back 3.3 million shares for more than $207 million.
Carmax also announced executive vice president and chief operating officer William C. Wood, Jr. will retire effective July 31, 2018.