Bear of the Day: America's Car-Mart (CRMT)
The Zacks Automotive – Retail and Wholesales industry has gotten off to a rough start in 2023, down roughly 8% YTD.
A company residing in the realm, America’s Car-Mart CRMT, has seen its near-term earnings outlook shift negative over the last several months, pushing the stock into a Zacks Rank #5 (Strong Sell).
Image Source: Zacks Investment Research
America's Car-Mart is one of the largest automotive retailers in the United States, focused exclusively on the Buy Here/Pay Here segment of the used car market. Let’s take a closer look at how the company currently stacks up.
Share Performance & Valuation
CRMT shares have struggled to find traction over the last year, down nearly 30% and underperforming relative to the S&P 500. As we can see in the chart below, there has been some pretty violent price action.
Image Source: Zacks Investment Research
The company’s shares currently trade at a 10.2X forward earnings multiple, beneath its five-year median and Zacks Retail – Wholesale sector average of 22.2X.
Image Source: Zacks Investment Research
CRMT carries a Style Score of a “C” for Value.
Quarterly Performance
CRMT has struggled to exceed EPS estimates as of late, falling short of earnings expectations in two consecutive quarters.
In its latest release, the company fell short of the Zacks Consensus EPS Estimate by more than 75% but reported sales 3% above expectations.
Bottom Line
A wide bottom line miss in its latest quarter and negative earnings estimate revisions from analysts paint a challenging picture for the company in the near term.
America’s Car-Mart CRMT is a Zacks Rank #5 (Strong Sell), indicating that analysts have lowered their bottom-line outlook across the last 60 days.
For those seeking strong stocks, a great idea would be to focus on stocks carrying a Zacks Rank #1 (Strong Buy) or a Zacks Rank #2 (Buy) – these stocks sport a notably stronger earnings outlook paired with the potential to deliver explosive gains in the near term.
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America's CarMart, Inc. (CRMT) : Free Stock Analysis Report
