Whisper Number: How Will CarMax Stock Move After Earnings?

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CarMax Group (NYSE:KMX) is expected to report earnings on Tuesday, September 24. The whisper number is $0.58, one cent ahead of the analysts’ estimate. Whispers range from a low of $0.55 to a high of $0.60. KMX has a 57 percent positive surprise history, having topped the whisper in 20 of the 35 earnings reports for which we have data.

Earnings history:

- Beat whisper: 20 qtrs
– Met whisper: 0 qtrs
– Missed whisper: 15 qtrs

Our primary focus is on post earnings price movement. Knowing how likely a stock’s price will move following an earnings report can help you determine the best action to take (long or short). In other words, we look at what happens when the company beats or misses the whisper number expectation.

The table below indicates the average post earnings price movement within a one and thirty trading day timeframe.

KMX913A

The strongest price movement of -1.7 percent comes within ten trading days when the company reports earnings that beat the whisper number, and -3.8 percent within five trading days when the company reports earnings that miss the whisper number. The overall average price move is ‘negative’ (beat the whisper number and see weakness, miss and see weakness) when the company reports earnings.

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