CarMax Cruises 8% Higher on Strong 1Q Results

CarMax (NYSE:KMX) beat the Street on Friday with a 21% leap in fiscal first-quarter profits thanks to a 22% surge in used-car sales.

Shares of the largest used-car retailer in the U.S. spiked 8% in premarket trading on the stronger-than-expected results.

CarMax said it earned $146.7 million, or 64 cents a share, last quarter, compared with a profit of $120.7 million, or 52 cents a share, a year earlier. Analysts had called for EPS of 58 cents.

Revenue jumped 19% to $3.31 billion, topping the Street’s view of $3.15 billion.

Overall same-store sales grew by 17%. Sales of used cars rose 22%, while wholesale unit sales increased 6%.

CarMax also said its auto finance income rose 16% to $87 million.

"Strong retail sales growth, together with continued contributions from CAF and wholesale drove all-time record quarterly revenues and earnings,” CEO Tom Folliard said in a statement.

CarMax said it repurchased 2.9 million shares of its common stock during the first quarter for $124.6 million. The company had $463.5 million remaining on its buyout program as of May 31.

Shares of Richmond, Va.-based CarMax rallied 7.70% to $48.00 in premarket trading on Friday, positioning them to build on their 2013 advance of 19%.