For those looking to find strong Retail-Wholesale stocks, it is prudent to search for companies in the group that are outperforming their peers. Is CarMax (KMX) one of those stocks right now? A quick glance at the company's year-to-date performance in comparison to the rest of the Retail-Wholesale sector should help us answer this question.
CarMax is one of 183 individual stocks in the Retail-Wholesale sector. Collectively, these companies sit at #8 in the Zacks Sector Rank. The Zacks Sector Rank considers 16 different groups, measuring the average Zacks Rank of the individual stocks within the sector to gauge the strength of each group.
The Zacks Rank is a proven system that emphasizes earnings estimates and estimate revisions, highlighting a variety of stocks that are displaying the right characteristics to beat the market over the next one to three months. CarMax is currently sporting a Zacks Rank of #1 (Strong Buy).
Over the past three months, the Zacks Consensus Estimate for KMX's full-year earnings has moved 14.9% higher. This shows that analyst sentiment has improved and the company's earnings outlook is stronger.
Our latest available data shows that KMX has returned about 36.2% since the start of the calendar year. At the same time, Retail-Wholesale stocks have gained an average of 0.8%. As we can see, CarMax is performing better than its sector in the calendar year.
Abercrombie & Fitch (ANF) is another Retail-Wholesale stock that has outperformed the sector so far this year. Since the beginning of the year, the stock has returned 20.8%.
For Abercrombie & Fitch, the consensus EPS estimate for the current year has increased 7.7% over the past three months. The stock currently has a Zacks Rank #1 (Strong Buy).
Looking more specifically, CarMax belongs to the Automotive - Retail and Wholesale - Parts industry, a group that includes 6 individual stocks and currently sits at #45 in the Zacks Industry Rank. This group has lost an average of 2.8% so far this year, so KMX is performing better in this area.
Abercrombie & Fitch, however, belongs to the Retail - Apparel and Shoes industry. Currently, this 38-stock industry is ranked #153. The industry has moved -9.4% so far this year.
CarMax and Abercrombie & Fitch could continue their solid performance, so investors interested in Retail-Wholesale stocks should continue to pay close attention to these stocks.
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This article originally published on Zacks Investment Research (zacks.com).