CarMax Ready to Breakout?

NYSE: KMX | CarMax Inc. News, Ratings, and Charts

KMX – A key level of resistance has formed in the chart of CarMax (KMX). If the stock breaks through this level, a breakout is expected. Read more to learn how to take advantage of this trade setup.

A key level of resistance has emerged in CarMax’s (KMX) chart. If this level is surpassed, a breakout is expected.

KMX is one of the largest retailers of used vehicles in the United States. The company also offers customers a full range of related services such financing and the sale of extended warranties, accessories, and vehicle repair services.

The company is benefiting from an increased demand for used cars as new car manufacturing at many companies is behind schedule due to pandemic shutdowns and a worldwide chip shortage. Its omni-channel offerings have improved the customer shopping experience and should bolster revenues in the long-term.

KMX has a current ratio of 2.4, which means it has more than enough liquidity to handle short-term obligations. The company also has a respectable return on equity of 17.1%, which indicates efficiency.

In its most recent quarter, earnings per share were down slightly at 2.3% year over year. Though, revenue increased 21.4% year over year. The stock appears a bit overvalued with a forward P/E of 22.78.

KMX’s stock price has shown bullish long-term momentum, which has resulted in a Momentum Grade of A in our POWR Ratings system and is represented in the chart below.

Take a look at the 1-year chart of KMX below with added notations:

 Chart of KMX provided by TradingView

KMX has recently stalled at the same $136 resistance level (red), which is also a 52-week high, multiple times since the beginning of March. The stock fell back at the end of that month, but now seems to be making another run higher.

A solid close above that $136 mark should lead to much higher prices for the stock. The possible long position on the stock would be on a breakout above that level with a protective stop placed under it.

Want to Discover More Great Trades?

I have explored virtually every flavor of technical analysis and chart pattern known to mankind. The sad fact is that the vast majority of them don’t work at all.

That is why I recently put together this special report to help investors focus on the only 5 chart patterns that matter…the ones that lead to the most timely and profitable stock trades. Click below to get your copy now!

5 WINNING Stock Chart Patterns

Have a good trading day!

Good luck!

Christian Tharp, CMT

@cmtstockcoach

Want More Great Investing Ideas?

3 Stocks to DOUBLE This Year


KMX shares were unchanged in premarket trading Wednesday. Year-to-date, KMX has gained 40.85%, versus a 12.10% rise in the benchmark S&P 500 index during the same period.


About the Author: Christian Tharp


I am an expert stock market coach having helped over 4000 beginner and advanced traders & investors from around the world take control of their financial futures. I also write stock market related articles for the Adam Mesh Trading Group and Yolo Publishing. More...


More Resources for the Stocks in this Article

TickerPOWR RatingIndustry RankRank in Industry
KMXGet RatingGet RatingGet Rating

Most Popular Stories on StockNews.com


Where Do Stocks Go from Here?

The S&P 500 (SPY) has already made new highs just above 6,000. However, that seems to be a point of stiff resistance. This begs the question of what happens next? And what should an investor do to stay on the right side of the action? Read on below for Steve Reitmeister’s time answers and top 10 stocks.

3 Streaming Stocks Benefiting from Cord-Cutting Trends

As streaming continues to dominate the digital entertainment landscape, the global streaming market presents a lucrative investment opportunity. So, it could be ideal to invest in fundamentally solid streaming stocks Netflix (NFLX), Walt Disney (DIS), and Roku (ROKU). Read further...

3 Gold Stocks to Buy as Safe-Haven Demand Grows

Gold is a stable investment now due to its role as a safe-haven asset during economic uncertainty, rising demand, industrial use, and growth, bolstered by central bank purchases and interest rate cuts. Therefore, investors should consider investing in top gold stocks such as Newmont (NEM), Barrick Gold (GOLD), and Agnico Eagle Mines (AEM). Read more...

3 AI Stocks Transforming Industries and Driving Future Growth

With rapid digitalization, rapid adoption, and development, as well as surging demand, the AI market is on the rise. Amid this backdrop, investors could buy fundamentally solid AI stocks NVIDIA Corporation (NVDA), Microsoft (MSFT), and Meta Platforms (META) poised for substantial gains. Continue reading...

What Happens After 6,000 for Stocks?

The S&P 500 (SPY) has the petal to the medal after the election and 2nd Fed rate cut. However, stocks are now pressed up against serious resistance at 6,000 which begs the question of what happens next? Investment pro Steve Reitmeister shares his timely market views including a preview of his top 10 stocks. Get the full story below...

Read More Stories

More CarMax Inc. (KMX) News View All

Event/Date Symbol News Detail Start Price End Price Change POWR Rating
Loading, please wait...
View All KMX News