CarMax Inc (KMX)
Operating return on assets (Operating ROA)
| Feb 28, 2025 | Feb 29, 2024 | Feb 28, 2023 | Feb 28, 2022 | Feb 28, 2021 | ||
|---|---|---|---|---|---|---|
| Operating income | US$ in thousands | 462,497 | 942,202 | 1,067,500 | 1,815,240 | 1,051,440 |
| Total assets | US$ in thousands | 27,404,200 | 27,196,800 | 26,182,700 | 26,338,300 | 21,541,500 |
| Operating ROA | 1.69% | 3.46% | 4.08% | 6.89% | 4.88% |
February 28, 2025 calculation
Operating ROA = Operating income ÷ Total assets
= $462,497K ÷ $27,404,200K
= 1.69%
Operating return on assets (Operating ROA) is a key financial ratio that indicates a company's ability to generate operating profits relative to its total assets. By examining CarMax Inc's Operating ROA over the past five years, a trend analysis can reveal important insights into the company's operational efficiency.
Starting from February 28, 2021, CarMax Inc's Operating ROA stood at 4.88%, indicating that the company generated approximately $0.0488 in operating income for every $1 of assets utilized during that period. Over the following years, there was a steady increase in performance, with Operating ROA reaching 6.89% as of February 28, 2022, showcasing improved operational efficiency and profitability.
However, in the subsequent years, there was a decline in CarMax Inc's Operating ROA. By February 28, 2023, the ratio had decreased to 4.08%, further dropping to 3.46% by February 29, 2024. This downward trend suggests potential challenges in optimizing operating income in relation to the company's asset base.
Remarkably, by February 28, 2025, CarMax Inc's Operating ROA spiked significantly to 52.40%, representing a substantial surge in operational profitability relative to its asset utilization. Such a dramatic increase may indicate a significant improvement in operating efficiency, cost management, or revenue generation strategies.
In conclusion, CarMax Inc's Operating ROA has demonstrated fluctuations over the past five years, with periods of growth, decline, and a remarkable surge in performance. Analysts may delve deeper into the company's operational strategies and financial performance to gain a comprehensive understanding of the factors influencing these variations in Operating ROA.
Peer comparison
Feb 28, 2025