KMXCAUTIOUS

KMX Return on Equity (ROE) Analysis

3.6%

Higher than 37% of Consumer Cyclical sector peers

Updated 239h ago·SEC filings & market data

Key Takeaway

Return on equity (ROE) measures how much profit a company generates for every dollar of shareholder equity.

Sector Performance

37th percentile

KMX

3.6%

Sector Median

8.5%

Sector Avg

-20.0%

Prior Period

4.2%(Apr 2026)

↓ Declining

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Deep Analysis

Return on equity (ROE) measures how much profit a company generates for every dollar of shareholder equity.

CarMax’s current ROE of 3.6% means it earned only 3.6 cents in profit per dollar of equity, which is low. Among Consumer Cyclical peers, the sector median is 8.6%, placing CarMax in the 36th percentile — meaning 64% of peers have a higher ROE. Trend data is not available: the year-over-year and quarter-over-quarter changes are both marked as N/A, and no historical values beyond the current 3.6% are provided. Because the ROE is well below the sector median and there is no trend to suggest improvement, the combination signals that CarMax is generating weaker returns on invested capital relative to its industry, raising risk for investors seeking profitability. This metric directly supports the overall CAUTIOUS verdict, as the low ROE indicates below-average financial performance compared to sector peers.

Frequently Asked Questions

What does the Return on Equity (ROE) tell investors about KMX?

ROE measures how effectively management turns equity into profit. Consistently above 15% is typically considered strong. Negative equity distorts this metric.

How is the Return on Equity (ROE) calculated?

Return on Equity (ROE) is calculated as: Net Income / Shareholders' Equity.

How does KMX's Return on Equity (ROE) compare to its sector?

KMX's Return on Equity (ROE) of 3.6% compares to a Consumer Cyclical sector median of 8.5%, placing it in the 37th percentile.

Who are KMX's closest peers by Return on Equity (ROE)?

The closest Consumer Cyclical peers by Return on Equity (ROE) include: PVH (3.3%), APTV (1.8%), LI (-2.5%), HMC (-3.8%), CROX (-6.1%).

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Learn More About Return on Equity (ROE)

What Is Return on Equity (ROE) and Is Higher Always Better?

Return on equity ROE measures how efficiently a company generates profit from shareholder capital. Learn how to decompose ROE using DuPont analysis and why high leverage can make it dangerous—with Apple and JPMorgan examples.

The Formula

Net Income / Shareholders' Equity

Why It Matters

ROE measures how effectively management turns equity into profit. Consistently above 15% is typically considered strong. Negative equity distorts this metric.