Evercore ISI Downgrades This Used-Vehicle Retailer - Read Why

• Evercore ISI analyst Michael Montani downgraded CarMax Inc (NYSE:KMX) to In-Line from Outperform with a price target of $120, down from $145, implying a 10% upside.
• Montani said CarMax took a profitable share throughout the calendar year 2021. He sees used vehicle pricing remaining "stubbornly high" with a new and used vehicle shortage likely to extend into early 2024, and it appears to be crowding out lower-income used car buyers.
• The analyst's concern is CarMax retail used unit comps are more likely around flat than the 4% he had been anticipating in 2022. He notes elevated costs as CarMax plans to invest in headcount, technology, and advertising this year.
• Price Action: KMX shares are trading lower by 3.42% at $109.45 on the last check Wednesday.