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CarMax, Inc. (KMX) vs Lithia Motors, Inc. (LAD)

CarMax, Inc. and Lithia Motors, Inc. are both Auto & Truck Dealerships companies. CarMax, Inc. is the larger, with a market value of $7.5B against $6.5B — 1.2× the size. Lithia Motors, Inc. trades at the lower P/E: 9.8× against 26.0×. CarMax, Inc. grew revenue faster over the last twelve months: 4.79% against 2.10%. Lithia Motors, Inc. has the higher net margin (1.88% vs 1.06%) and the higher return on invested capital (6.20% vs 1.58%). Across the 21 metrics below, Lithia Motors, Inc. leads on 17 and CarMax, Inc. on 4.

Valuation

Metric KMX LAD Auto & Truck Dealerships median
P/E 25.96 9.79 15.92
P/S 0.27 0.18 0.27
P/B 1.20 1.03 2.00
Price to free cash flow 6.60 n/m 10.69
EV/EBITDA 21.90 7.97 8.59
EV/Sales 0.85 0.42 0.68
Earnings yield 3.85% 10.22% 3.16%
Free cash flow yield 15.15% (7.23%) 2.80%

Profitability

Metric KMX LAD Auto & Truck Dealerships median
Gross margin 10.31% 15.17% 19.56%
Operating margin 2.05% 4.08% 3.73%
Net margin 1.06% 1.88% 1.18%
Free cash flow margin 4.15% (1.26%) 2.34%
Return on equity 4.68% 10.63% 10.04%
Return on assets 1.10% 2.83% 0.75%
Return on invested capital 1.58% 6.20% 6.85%

Growth

Metric KMX LAD Auto & Truck Dealerships median
Revenue growth (TTM) 4.79% 2.10% 3.12%
EPS growth (last fiscal year) (47.66%) 9.01% 2.35%
Revenue growth, 5-year CAGR 6.43% 23.45% 10.46%
Net income growth, 5-year CAGR (19.83%) 11.75% 0.00%

Health

Metric KMX LAD Auto & Truck Dealerships median
Debt to equity 2.67 1.48 0.55
Current ratio 2.33 1.00 1.15
Net debt to EBITDA 16.96 4.71 1.34

Dividend

Metric KMX LAD Auto & Truck Dealerships median
Dividend yield — 0.80% 1.03%
Payout ratio — 0.08 0.24

Size

Metric KMX LAD Auto & Truck Dealerships median
Market cap 7.47b 6.49b 2.14b

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