DETROIT – CarMax Inc. (KMX) on Friday said quarterly profit fell 6 percent as new car sales declined, but a robust used-car sales outlook sent the auto retailer's shares up 12 percent.
The company said it expects same-store used-unit sales to rise 2 to 7 percent during the fourth quarter. Sales at comparable stores rose 2 percent during the third quarter.
Sales trends have continued to improve since September, President and Chief Executive Officer Austin Ligon said in a conference call.
"There appears to be improving demand. Since the elections, things seem to be better," Ligon told reporters and analysts.
Net earnings for the fiscal third quarter ended Nov. 30 fell to $18 million, or 17 cents a share, from $19.1 million, or 18 cents a share, a year earlier.
Richmond, Va.-based CarMax said it expects earnings of 19 to 23 cents a share in the fourth quarter. Wall Street analysts on average expect CarMax to earn 19 cents a share.
CarMax, which sells mostly used cars, said sales increased 13 percent to $1.22 billion from $1.07 billion a year earlier.
Shares of CarMax rose $3.30, or 12 percent, to $30.75 on the New York Stock Exchange (search) on Friday. The stock, which was the biggest gainer in percentage terms on the NYSE, rose to a high of $31.25 earlier in the session.