As investors brace for retaliatory tariffs set to take hold on April 2, Stephens says CarMax could buck the broader trend of market jitters and succeed even as the duties are implemented. “We believe KMX will likely marginally benefit from most tariff scenarios, at least in year 1,” Stephens analyst Jeff Lick wrote on Tuesday. The investment bank upgraded CarMax to overweight from equal weight Wednesday, raising its 12-month price target to $90 a share from $86. Stephens’ new valuation implies more than 21% upside from Tuesday’s $74.26 close. KMX YTD mountain CarMax stock in 2025. The analyst said he’s confident that CarMax can hit its full-year targets, as well as estimates for the fiscal fourth quarter that ended Feb. 28, which are due out on April 10. “Our analysis of both real-time unit sales and credit metrics give us comfort in our calendar 2025 estimates, especially 1H25,” Lick said. “We take comfort in KMX’s operational consistency in both credit and used unit [gross profit per unit].” Shares have ticked down about 7% in 2025, but are up about the same amount so far this week. Lick told CNBC it’s likely the proposed tariffs will create a volatile environment for used car prices, benefiting CarMax as it takes advantage of wider spreads between the cost of goods sold and their actual selling prices. Additionally, Lick said CarMax shares can rally as investors look for alternative automotive exposure beyond original equipment manufacturers who will be hardest hit by tariffs. Stephens isn’t alone in seeing the Trump adminstration’s tariffs as a potential catalyst for CarMax. Evercore ISI analyst Michael Montani in February said consumers are already trading down to used cars, as the value gap between new and used vehicles has widened. Tariffs on imports could heighten the trend, and ultimately benefit CarMax, given its focus on used cars, he wrote. Trump’s tariffs on April 2 are aimed at any country that imposes duties on U.S. imports. The president has labeled the start date for the forthcoming tariffs as “Liberation Day.” At the same time, Trump be signaling a softening in his stance. The president said on Tuesday that the tariffs will “probably be more lenient than reciprocal.” Get Your Ticket to Pro LIVE Join us at the New York Stock Exchange!|Uncertain markets? Gain an edge with CNBC Pro LIVE , an exclusive, inaugural event at the historic New York Stock Exchange. In today’s dynamic financial landscape, access to expert insights is paramount. As a CNBC Pro subscriber, we invite you to join us for our first exclusive, in-person CNBC Pro LIVE event at the iconic NYSE on Thursday, June 12. Join interactive Pro clinics led by our Pros Carter Worth, Dan Niles, and Dan Ives, with a special edition of Pro Talks with Tom Lee. You’ll also get the opportunity to network with CNBC experts, talent and other Pro subscribers during an exciting cocktail hour on the legendary trading floor. Tickets are limited!
