Group 1 Automotive vs CarMax
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KIRA’s take AI analyst
I put Group 1 Automotive and CarMax side by side, using each one’s latest annual report. Here is what stands out:
- CarMax is the larger business, with $25.9B of revenue in fiscal 2026 against $22.6B for Group 1 Automotive.
- Group 1 Automotive grew revenue faster (13.2%, against −1.8%).
- CarMax turned more of its sales into free cash flow (4.8% FCF margin, against 1.9%).
- Group 1 Automotive earned a higher return on the capital invested in it (8.6%, against 1.3%).
- Investors pay more for each dollar of CarMax’s earnings: a P/E of 24.8x against 10.1x for Group 1 Automotive.
Who comes out ahead
Of the 9 measures where higher (or lower) is clearly better, how many each company leads.
Group 1 Automotive
GPI
6/9
Revenue growth5-year growthGross marginNet marginReturn on capitalReturn on equity
CarMax
KMX
2/9
FCF marginShare count change
Side by side
Best in the row
| Latest fiscal year | GPI FY25 | KMX FY26 |
|---|---|---|
| Size | ||
| Market cap | $2.9B | $7.5B |
| Revenue | $22.6B | $25.9B |
| Free cash flow | $425M | $1.2B |
| Net income | $325M | $247M |
| Growth | ||
| Revenue growth | 13.2% | −1.8% |
| 5-year growth | 16.3% | 6.4% |
| Share count change | −3.9% | −5.4% |
| Profitability | ||
| Gross margin | 16.1% | 10.8% |
| Operating margin | 3.3% | — |
| Net margin | 1.4% | 1.0% |
| FCF margin | 1.9% | 4.8% |
| Return on capital | 8.6% | 1.3% |
| Return on equity | 11.3% | 4.1% |
| Balance sheet | ||
| Net debt | $3.7B | $17.3B |
| Net debt / EBITDA | — | 20.6x |
| Dividends and buybacks | $580M | $643M |
| Valuation & quality | ||
| P/E | 10.1x | 24.8x |
| Piotroski F-score | 5 | 5 |
Ten years
Revenue
Operating margin
Free cash flow
Return on capital
Each company's latest fiscal year; fiscal years end in different months. The best value in each row is highlighted where higher (or lower) is clearly better. Not investment advice.