Enterprise vs CarMax Which Is More Promising?

Enterprise and CarMax are two leading companies in the automotive industry with unique business models. Enterprise Holdings, a privately-owned company, is known for its car rental services worldwide. On the other hand, CarMax is a publicly traded company specializing in used car sales. Investors keen on the automotive sector may be interested in comparing the performance of these two stocks. Factors such as revenue growth, market share, and overall industry trends can influence their investment decisions.

Enterprise or CarMax?

When comparing Enterprise and CarMax, 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 Enterprise and CarMax.

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. Enterprise has a dividend yield of -%, while CarMax has a dividend yield of -%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Enterprise reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%. On the other hand, CarMax reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%.

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 Enterprise P/E ratio at 20.62 and CarMax's P/E ratio at 32.19. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Enterprise P/B ratio is 2.36 while CarMax's P/B ratio is 2.17.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Enterprise has seen a 5-year revenue growth of 0.81%, while CarMax's is 0.99%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Enterprise's ROE at 12.38% and CarMax's ROE at 6.83%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $1.39 for Enterprise and $85.23 for CarMax. Over the past year, Enterprise's prices ranged from $0.53 to $2.10, with a yearly change of 296.23%. CarMax's prices fluctuated between $65.38 and $88.22, with a yearly change of 34.93%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.