What is Carmax Inc worth?
With the base-case assumptions below, a discounted cash flow model on Carmax Inc's reported free cash flow gives $50.07 per share. The share price was $57.21 on September 25, 2026, 14% above that value.
Inputs from the filings
Three sets of assumptions
| Case | Growth yrs 1-5 | Discount rate | Value per share | Value vs price |
|---|---|---|---|---|
| Bear | 1.5% | 10.0% | -$12.97 | -123% |
| Base | 6.5% | 9.0% | $50.07 | -12% |
| Bull | 11.5% | 8.0% | $175.76 | +207% |
Sensitivity: base case value per share
| 1.5% | 2.0% | 2.5% | 3.0% | 3.5% | |
|---|---|---|---|---|---|
| 7.0% | $96.63 | $110.85 | $128.23 | $149.95 | $177.87 |
| 8.0% | $61.88 | $71.10 | $82.00 | $95.07 | $111.06 |
| 9.0% | $36.49 | $42.79 | $50.07 | $58.55 | $68.58 |
| 10.0% | $17.15 | $21.63 | $26.71 | $32.52 | $39.22 |
| 11.0% | $1.93 | $5.22 | $8.89 | $13.03 | $17.71 |
Where the presets come from
Base: years 1 to 5 grow at Carmax Inc's revenue growth rate over the last 5 fiscal years (6.4% a year), held between -5% and 15%. Years 6 to 10 grow halfway between that and the long-run rate of 2.5%. Future cash is discounted at 9% a year.
Bear: 5 points less growth, 2% long-run growth, 10% discount rate. Bull: 5 points more growth (at most 25%), 3% long-run growth, 8% discount rate.
Value per share = (present value of 10 years of free cash flow + present value of everything after + cash - debt) / diluted shares.
This is a model run on assumptions, not a recommendation or a price target. Small changes in the discount rate or growth move the result a lot, as the table above shows. Change them yourself in the calculator.
Adjust the assumptions
Move the sliders for growth, long-run growth and discount rate, or switch to average free cash flow, and see the value per share change.
Adjust the assumptions