CarMax Inc (KMX)

Debt-to-equity ratio

		Feb 29, 2024	Nov 30, 2023	Aug 31, 2023	May 31, 2023	Feb 28, 2023	Nov 30, 2022	Aug 31, 2022	May 31, 2022	Feb 28, 2022	Nov 30, 2021	Aug 31, 2021	May 31, 2021	Feb 28, 2021	Nov 30, 2020	Aug 31, 2020	May 31, 2020	Feb 29, 2020	Nov 30, 2019	Aug 31, 2019	May 31, 2019
Long-term debt	US$ in thousands	1,602,360	1,605,640	1,608,720	1,906,500	1,909,360	1,903,220	2,511,420	2,569,750	3,255,300	2,602,600	2,190,420	1,320,210	1,322,420	1,319,500	1,896,780	1,693,890	1,778,670	1,704,280	1,689,080	1,573,870
Total stockholders’ equity	US$ in thousands	6,073,740	6,044,360	6,005,660	5,823,170	5,613,080	5,487,570	5,414,230	5,400,640	5,235,440	5,109,800	4,915,180	4,703,480	4,364,610	4,128,480	3,982,560	3,578,310	3,768,880	3,698,050	3,611,560	3,452,760
Debt-to-equity ratio		0.26	0.27	0.27	0.33	0.34	0.35	0.46	0.48	0.62	0.51	0.45	0.28	0.30	0.32	0.48	0.47	0.47	0.46	0.47	0.46

February 29, 2024 calculation

Debt-to-equity ratio = Long-term debt ÷ Total stockholders’ equity
= $1,602,360K ÷ $6,073,740K
= 0.26

CarMax Inc's debt-to-equity ratio has displayed fluctuations over the past several periods. It stood at 0.26 as of February 29, 2024, which indicates that the company had $0.26 in debt for every dollar of equity. The ratio has generally been within a relatively moderate range of 0.26 to 0.62 over the periods indicated, with some minor fluctuations.

A lower debt-to-equity ratio suggests a lower level of financial risk and indicates that CarMax has been using less debt financing relative to its equity. This could be seen as a positive sign in terms of the company's financial stability and ability to meet its financial obligations.

The gradual increase in the ratio from 0.26 to 0.62 over the periods suggests a potential increasing reliance on debt financing, which may warrant further analysis to understand the reasons behind this trend. It would be important to monitor how this trend evolves in upcoming periods to assess its impact on the company's financial health and risk profile.