CarMax vs Hertz Global Which Should You Buy?

CarMax Inc. and Hertz Global Holdings Inc. are two renowned companies operating in the automotive industry. CarMax is a retailer of used vehicles, while Hertz Global is a provider of car rental services. Both companies have their stocks listed on major stock exchanges and are subject to market trends and consumer demand. Investors often compare the performance of these companies to determine the growth potential and stability of their respective stocks in the ever-changing financial landscape.

CarMax or Hertz Global?

When comparing CarMax and Hertz Global, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between CarMax and Hertz Global.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. CarMax has a dividend yield of -%, while Hertz Global has a dividend yield of -%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. CarMax reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%. On the other hand, Hertz Global reports a 5-year dividend growth of 0.00% year and a payout ratio of -0.26%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with CarMax P/E ratio at 28.66 and Hertz Global's P/E ratio at -1.34. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. CarMax P/B ratio is 1.94 while Hertz Global's P/B ratio is 0.53.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, CarMax has seen a 5-year revenue growth of 0.99%, while Hertz Global's is -0.70%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with CarMax's ROE at 6.83% and Hertz Global's ROE at -27.37%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $75.63 for CarMax and $3.15 for Hertz Global. Over the past year, CarMax's prices ranged from $62.45 to $88.22, with a yearly change of 41.27%. Hertz Global's prices fluctuated between $2.47 and $10.82, with a yearly change of 338.06%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.