As the craze of earnings season draws to a close, here’s a look back at some of the most exciting (and some less so) results from Q2. Today, we are looking at vehicle retailer stocks, starting with America's Car-Mart (NASDAQ: CRMT).
Buying a vehicle is a big decision and usually the second-largest purchase behind a home for many people, so retailers that sell new and used cars try to offer selection, convenience, and customer service to shoppers. While there is online competition, especially for research and discovery, the vehicle sales market is still very fragmented and localized given the magnitude of the purchase and the logistical costs associated with moving cars over long distances. At the end of the day, a large swath of the population relies on cars to get from point A to point B, and vehicle sellers are acutely aware of this need.
The 4 vehicle retailer stocks we track reported a mixed Q2. As a group, revenues missed analysts’ consensus estimates by 0.5%.
While some vehicle retailer stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 3.8% since the latest earnings results.
Weakest Q2: America's Car-Mart (NASDAQ: CRMT)
With a strong presence in the Southern and Central US, America’s Car-Mart (NASDAQ: CRMT) sells used cars to budget-conscious consumers.
America's Car-Mart reported revenues of $341.3 million, down 1.5% year on year. This print fell short of analysts’ expectations by 5%. Overall, it was a disappointing quarter for the company with a significant miss of analysts’ EBITDA estimates and a significant miss of analysts’ EPS estimates.
America's Car-Mart delivered the weakest performance against analyst estimates and slowest revenue growth of the whole group. Unsurprisingly, the stock is down 20.6% since reporting and currently trades at $35.36.
Read our full report on America's Car-Mart here, it’s free.
Best Q2: Camping World (NYSE: CWH)
Founded in 1966 as a single recreational vehicle (RV) dealership, Camping World (NYSE: CWH) still sells RVs along with boats and general merchandise for outdoor activities.
Camping World reported revenues of $1.98 billion, up 9.4% year on year, outperforming analysts’ expectations by 5.2%. The business had a very strong quarter with a solid beat of analysts’ EBITDA estimates.
Camping World delivered the biggest analyst estimates beat and fastest revenue growth among its peers. However, the results were likely priced into the stock as it’s traded sideways since reporting. Shares currently sit at $17.52.
Is now the time to buy Camping World? Access our full analysis of the earnings results here, it’s free.
Lithia (NYSE: LAD)
With a strong presence in the Western US, Lithia Motors (NYSE: LAD) sells a wide range of vehicles, including new and used cars, trucks, SUVs, and luxury vehicles from various manufacturers.
Lithia reported revenues of $9.58 billion, up 3.8% year on year, falling short of analysts’ expectations by 2%. Still, its results were good as it locked in an impressive beat of analysts’ EBITDA estimates and a solid beat of analysts’ gross margin estimates.
Interestingly, the stock is up 12% since the results and currently trades at $343.99.
Read our full analysis of Lithia’s results here.
CarMax (NYSE: KMX)
Known for its transparent, customer-centric approach and wide selection of vehicles, Carmax (NYSE: KMX) is the largest automotive retailer in the United States.
CarMax reported revenues of $7.55 billion, up 6.1% year on year. This result was in line with analysts’ expectations. Overall, it was a very strong quarter as it also produced an impressive beat of analysts’ EBITDA estimates and a solid beat of analysts’ gross margin estimates.
The stock is down 5.9% since reporting and currently trades at $60.53.
Read our full, actionable report on CarMax here, it’s free.
Market Update
In response to the Fed’s rate hikes in 2022 and 2023, inflation has been gradually trending down from its post-pandemic peak, trending closer to the Fed’s 2% target. Despite higher borrowing costs, the economy has avoided flashing recessionary signals. This is the much-desired soft landing that many investors hoped for. The recent rate cuts (0.5% in September and 0.25% in November 2024) have bolstered the stock market, making 2024 a strong year for equities. Donald Trump’s presidential win in November sparked additional market gains, sending indices to record highs in the days following his victory. However, debates continue over possible tariffs and corporate tax adjustments, raising questions about economic stability in 2025.
Want to invest in winners with rock-solid fundamentals? Check out our 9 Best Market-Beating Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.
