CarMax, Inc. (KMX) is a holding company engaged in providing used vehicles, related products and services through two segments: CarMax Sales Operations and CarMax Auto Finance (CAF). The stock is currently trading around $72.47 at the upper end of its 52 week range of $43.27-$75.40. The stock has been outperforming the market this year rallying 8.8% year to date. KMX is scheduled to report earnings before the opening bell tomorrow, and the stock is up today slightly moving $0.24 or %0.33 on the session ahead of the close.

Over the past 12 quarters KMX has rallied on earnings day 5 times with an average move of 8.05%. The stock appears bullish on chart going into the release having traded above the Ichimoku Cloud for the past couple months on the daily bars. The Ichimoku Cloud continues to maintain the bullish trend for the upcoming trading periods. Over the past 12 quarters KMX has rallied from earnings to the nearest options expiration 6 times with an average move of 7.00%. The stock looks as if it could continue its trend and rip to the upside further in today’s session. Investors are mainly looking to see large growth numbers. The company orientates itself around growth and continuously reports industry average crushing numbers in EPS, and cash flow. Positive revision estimates have been seen as well.

The options market is currently implying a move of around $4.55 or 6.3% in KMX by this Friday’s close giving us targets of $77.02 and $67.92.

Andrew Keene

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