Tag: CarMax

Wall Street’s top analysts are unanimously bullish on stocks like Amazon and CarMax

How can you find compelling investing opportunities in the current environment? With market volatility set to rise in the coming weeks, it’s best to be prepared. October is a notoriously volatile month, and this week’s heated presidential election debate did little to calm the markets — especially with the looming prospect of a contested election result down the line.



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However, there are still stocks out there ready to outperform — you just have to find them. One possible way forward is to follow stock recommendations from analysts with a proven track record of success. TipRanks analyst forecasting service reveals the analysts with the highest success rate and average return measured on a one-year basis — factoring in the number of ratings made by each analyst. 

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Most importantly, the stocks highlighted below have scored only buy ratings from these top analysts in the last three

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Is Carvana’s Stock Overvalued Compared To CarMax?

E-commerce based used-car retailer, Carvana’s (NYSE: CVNA) P/S (price-to-sales) multiple of 2.7x is higher than the figure of 0.9x for CarMax (NYSE: KMX), a used-car industry leader. So, is Carvana stock too expensive compared to CarMax stock? We believe that Carvana stock is currently overvalued compared to CarMax stock, due to the notable mismatch in their current P/S multiples when compared with returns and risk profiles for the two companies over recent years.

Carvana’s revenue growth is much higher (114% average annual revenue growth over the 2017-2019 period vs about 8.9% for CarMax), which explains the higher P/S multiple. However, CarMax’s returns are better. Specifically, CarMax’s net income margin (net profits as a percent of revenue) stood at over

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