When a company with poor prospects posts quarterly results that are better than feared, the stock rallies. Carmax (KMX) gained 4.99% yesterday after posting revenue of $7.01 billion, down by 0.8% Y/Y.
Carmax has poor prospects. The firm reported a 12.7% drop in total wholesale revenue, hurt by a lower price per vehicle. The ASP for used vehicles and wholesale vehicles fell by 4.6% and 12.9% respectively.
The provision for loan losses is a serious worry. Carmax took a $112.6 million loan loss provision, up by 25% from last year.
Accenture (ACN) jumped by 5.57% after posting the benefits of the AI tailwind in the fourth quarter. EPS grew by 3% Y/Y to $2.79. CEO Julie Sweet said, “We continue to accelerate our leadership in Generative AI, which we believe is the most transformative technology of the next decade, delivering $3 billion in new bookings for the year.”
Accenture hiked its dividend to $1.48 per share a quarter, a 14.7% increase. It also bought back 2.1 million shares in the last quarter.
ACN stock might pull back. However, the business is attractive.
In the gaming sector, be wary of Ubisoft Entertainment (UBSFY). The firm postponed the release of Assassin’s Creed Shadows. When the company once said that gamers did not own their titles, it angered its loyal fan base.
Ubisoft’s Shadow’s title has a high risk of a flopped release. Still, the firm may fix the issues of the game well enough to prevent weak initial sales
