Asset Breakdown
17 B
Assets Non Current
3.7 B
Current Assets
| Total Assets | 20.77 Billion | |
| Current Assets | 3.73 Billion | |
| Assets Non Current | 17.04 Billion | |
| Tax Assets | 96.71 Million |
You think CarMax (NYSE:KMX) debt is an issue for investors?
 | By Rifka Kats | Macroaxis Story |
CarMax Inc is scheduled to announce its earnings tomorrow. The upcoming quarterly report is expected on the 1st of April 2021. CarMax Asset Turnover is fairly stable at the moment as compared to the past year. CarMax reported Asset Turnover of 0.90 in 2020. Current Ratio is likely to rise to 2.27 in 2021, whereas Net Income Per Employee is likely to drop slightly above 26.7 K in 2021. As many millenniums are trying to avoid consumer cyclical space, it makes sense to break down CarMax Inc a little further and try to understand its current market patterns.
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Reviewed by Michael Smolkin
This firm has 15.5 B in debt with debt to equity (D/E) ratio of 3.75, meaning that CarMax Inc heavily relies on borrowing funds for operations.
The asset utilization indicator refers to the revenue earned for every dollar of assets a company currently reports. CarMax has an asset utilization ratio of 137.48 percent. This suggests that the company is making $1.37 for each dollar of assets. An increasing asset utilization means that CarMax Inc is more efficient with each dollar of assets it utilizes for everyday operations.
CarMax financial leverage ratio helps determine the effect of debt on the overall profitability of the company. It measures the total debt position of CarMax, including all of CarMax's outstanding debt obligations, and compares it with the equity. In simple terms, the high financial leverage means the cost of production, together with running the business day-to-day, is high, whereas, lower financial leverage implies lower fixed cost investment in the business and generally considered by investors to be a good sign. So if creditors own a majority of CarMax assets, the company is considered highly leveraged. Understanding the composition and structure of overall CarMax debt and outstanding corporate bonds gives a good idea of how risky the capital structure of a business is and if it is worth investing in it. Please read more on our technical analysis page. Understanding CarMax Total Debt
CarMax Inc liabilities are broken down into two parts on the balance sheet. These are short-term (or current) obligations and long-term debt. CarMax Inc has to fulfill its short-term liabilities in this reporting year and should be no more than 12 months old. Long-term debt, on the other hand, is anything beyond the 12-month payment timeframe. Common short-term liabilities found on CarMax balance sheet include debt obligations and money owed to different CarMax vendors, workers, and loan providers. Below is the chart of CarMax main long-term debt accounts currently reported on its balance sheet. You can use CarMax Inc financial leverage analysis tool to get a better grip on understanding its financial positionHow important is CarMax's Liquidity
CarMax financial leverage refers to using borrowed capital as a funding source to finance CarMax Inc ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. CarMax financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Financial leverage can amplify the potential profits to CarMax's owners, but it also increases the potential losses and risk of financial distress, including bankruptcy, if the firm cannot cover its debt costs. The degree of CarMax's financial leverage can be measured in several ways, including by ratios such as the debt-to-equity ratio (total debt / total equity), equity multiplier (total assets / total equity), or the debt ratio (total debt / total assets). Please check the breakdown between CarMax's total debt and its cash.
Breaking it down
The company reported the last year's revenue of 19.88 B. Total Income to common stockholders was 751.91 M with profit before taxes, overhead, and interest of 3.18 B.
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