WallStSmart

Carvana Co (CVNA)vsCarMax Inc (KMX)

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Smart Verdict

WallStSmart Research — data-driven comparison

CarMax Inc generates 7% more annual revenue ($29.46B vs $27.45B). CVNA leads profitability with a 6.2% profit margin vs 1.0%. KMX trades at a lower P/E of 25.5x. KMX earns a higher WallStSmart Score of 65/100 (B-).

CVNA

Buy

60

out of 100

Grade: C+

Growth: 9.3Profit: 7.0Value: 3.7Quality: 7.0
Piotroski: 5/9Altman Z: 2.18

KMX

Strong Buy

65

out of 100

Grade: B-

Growth: 6.7Profit: 4.0Value: 6.3Quality: 5.5
Piotroski: 4/9Altman Z: 1.66
IV

Intrinsic Value Comparison

Multi-model valuation · Graham Formula

CVNASignificantly Overvalued (-32.8%)

Margin of Safety

-32.8%

Fair Value

$51.41

Current Price

$72.00

$20.59 premium

UndervaluedFair: $51.41Overvalued

Intrinsic value data unavailable for KMX.

Key Strengths & Concerns

Side-by-side fundamental analysis

Key Strengths

CVNA4 strengths · Avg: 9.8/10
Return on EquityProfitability
38.9%10/10

Every $100 of equity generates 39 in profit

Revenue GrowthGrowth
42.4%10/10

Revenue surging 42.4% year-over-year

EPS GrowthGrowth
85.7%10/10

Earnings expanding 85.7% YoY

Market CapQuality
$75.70B9/10

Large-cap with strong market position

KMX4 strengths · Avg: 9.0/10
Price/BookValuation
1.3x10/10

Reasonable price relative to book value

EPS GrowthGrowth
81.6%10/10

Earnings expanding 81.6% YoY

PEG RatioValuation
0.688/10

Growing faster than its price suggests

Revenue GrowthGrowth
17.7%8/10

17.7% revenue growth

Areas to Watch

CVNA4 concerns · Avg: 3.5/10
P/E RatioValuation
32.8x4/10

Premium valuation, high expectations priced in

Price/BookValuation
11.9x4/10

Trading at 11.9x book value

Profit MarginProfitability
6.2%3/10

6.2% margin — thin

Debt/EquityHealth
1.403/10

Elevated debt levels

KMX4 concerns · Avg: 3.5/10
P/E RatioValuation
25.5x4/10

Moderate valuation

Altman Z-ScoreHealth
1.664/10

Distress zone — elevated risk

Return on EquityProfitability
4.2%3/10

ROE of 4.2% — below average capital efficiency

Profit MarginProfitability
1.0%3/10

1.0% margin — thin

Comparative Analysis Report

WallStSmart Research

Bull Case : CVNA

The strongest argument for CVNA centers on Return on Equity, Revenue Growth, EPS Growth. Revenue growth of 42.4% demonstrates continued momentum.

Bull Case : KMX

The strongest argument for KMX centers on Price/Book, EPS Growth, PEG Ratio. Revenue growth of 17.7% demonstrates continued momentum. PEG of 0.68 suggests the stock is reasonably priced for its growth.

Bear Case : CVNA

The primary concerns for CVNA are P/E Ratio, Price/Book, Profit Margin.

Bear Case : KMX

The primary concerns for KMX are P/E Ratio, Altman Z-Score, Return on Equity. Debt-to-equity of 2.83 is elevated, increasing financial risk. Thin 1.0% margins leave little buffer for downturns.

Key Dynamics to Monitor

CVNA profiles as a hypergrowth stock while KMX is a growth play — different risk/reward profiles.

CVNA carries more volatility with a beta of 3.55 — expect wider price swings.

CVNA is growing revenue faster at 42.4% — sustainability is the question.

KMX generates stronger free cash flow (806M), providing more financial flexibility.

Bottom Line

KMX scores higher overall (65/100 vs 60/100) and 17.7% revenue growth. Both earn "Strong Buy" and "Buy" ratings respectively — the choice depends on your investment horizon and risk tolerance.

This analysis is generated from publicly available financial data. Not financial advice.

Carvana Co

CONSUMER CYCLICAL · AUTO & TRUCK DEALERSHIPS · USA

Carvana Co., operates an e-commerce platform to buy and sell used cars in the United States. The company is headquartered in Tempe, Arizona.

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CarMax Inc

CONSUMER CYCLICAL · AUTO & TRUCK DEALERSHIPS · USA

CarMax is a used vehicle retailer based in the United States. It operates two business segments: CarMax Sales Operations and CarMax Auto Finance.

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