Carmax tumbles on worse-than-expected earnings and sinking used car sales

Shares of CarMax sank more than 13% in premarket trading following the company’s second-quarter earnings report.

The used vehicle retailer posted adjusted earnings per share of $0.64, missing Wall Street estimates of $1.04 per share by 38%. CarMax’s sales came in at $6.59 billion, a 6% drop from the same period last year and also below the analyst consensus of $7.01 billion.

CarMax sold 5.4% fewer used vehicles to retail customers, with retail unit sales coming in at 199,729. Its average selling price for the vehicles dipped 1% to $25,993.

CarMax’s sales are still ahead of rival Carvana, though the latter has been working diligently to close the gap. Despite selling fewer cars, Carvana’s market cap is more than 10x CarMax’s. CarMax’s report also weighed on Carvana in the premarket Thursday, with the stock down more than 3%.

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SpaceX gets a wave of bullish ratings from Wall Street analysts

SpaceX received more than a dozen positive analyst calls on Tuesday — including from major Wall Street banks — as they initiate coverage on Elon Musk’s space and AI company.

SpaceX went public on June 12 at a $2.2 trillion valuation, the largest debut in history. While the company hasn’t yet posted a profit, it seems to have convinced Wall Street that it will get there and grow its valuation on the way.

Of the at least 17 analysts that gave a rating on Tuesday, all but one gave it a “buy” or “outperform” rating. MoffettNathanson was "neutral."

The ratings come as SpaceX joined the Nasdaq 100 index, a benchmark tech-heavy basket of companies that underpins millions of portfolios. The inclusion adds built-in demand for the stock from index funds and ETFs.

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Nike sinks to lowest level since 2014 after warning of “challenged” sales environment in Q4 report

Did Nike do it?

Investors had a mixed reaction after the global sports apparel company reported its fourth quarter earnings on Tuesday after the bell. Shares initially rose 5% as Nike beat out Wall Street expectations amid a hefty tariff refund bonus. However, the stock then sank to its lowest level since August 2014 in postmarket trading.

Here are the Q4 numbers:

Revenue of $11.0 billion (estimate: $10.8 billion).
Adjusted earnings per share of $0.20 (estimate: $0.12).

Ahead of this report, Nike warned that results would be flattered by a one-time tariff refund (now estimated at roughly $0.52 per share for the bottom line). That gave the company an extra cushion in snapping its streak of seven quarters of year-over-year profit declines.

Over the past year, the company had been punished by tariffs on imported goods, stagnant consumer spending, and increasing competition from other footwear brands like New Balance, Adidas, and Hoka.

Outgoing CFO Matthew Friend deemed it an “increasingly challenging operating environment, where sell-through remains challenged.”

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