* Third-quarter revenue $2.60 bln vs est $2.47 bln
* EPS $0.41 vs est $0.39
* Retail used-car sales rise 17 pct, wholesale business
sales 10 pct
* Shares up 8 percent
Dec 20 CarMax Inc, the largest U.S.
used-car retailer, reported a stronger-than-expected
third-quarter profit as a rise in supply, more attractive
financing options and improved customer sentiment helped it sell
more vehicles to retail clients.
CarMax's shares were up 8 percent in morning trading on the
New York Stock Exchange. The stock has gained more than 40
percent since touching a year-low in June.
Used-car supplies have improved after a shortage over the
previous few quarters as customers ditch their old cars in favor
of more recent used models and new ones, the company said.
"We believe consumer sentiment has improved somewhat, which
may be resulting in more engaged customers in our stores," Chief
Executive Thomas Folliard said on a conference call.
Chief Financial Officer Thomas Reedy said customers have
also become more responsive to low interest rates, leading to
increased sales as well as fewer "payoffs", in which customers
sell their car to CarMax but don't buy a replacement.
Sales in the company's wholesale business rose for the first
time in three quarters. The business sells cars that don't meet
its retail standards to licensed dealers.
Used vehicle sales to retail customers rose 17 percent to
$2.07 billion in the quarter, while wholesale sales rose 10
percent to $427.7 million. Total sales rose 15 percent to $2.60
Net income rose to $94.7 million, or 41 cents per share, in
the third quarter from $82.1 million, or 36 cents per share, a
Oppenheimer & Co analyst Brian Nagel said he believed the
results represented the start of a long-awaited sales recovery
for the company.
Analysts on average expected earnings of 39 cents per share,
excluding items, on revenue of $2.47 billion, according to
Thomson Reuters I/B/E/S.