CarMax Stock Cruising Toward Best Day in 3 Years

CarMax Inc (KMX) stock soaring this morning, after the retailer posted better-than-expected earnings for the fiscal fourth quarter. The company's adjusted earnings of 44 cents per share nearly doubled analysts' expectations, while revenue came in lower than anticipated. 

Last seen up 9.8% to trade at $72.35, KMX is now up 17.5%year-to-date. The shares are on track for the best single-session gain since March 2020, and are trading at their highest level since Feb. 21. The stock's 200-day moving average, which served as a ceiling back in February, remains potential resistance above.

A short squeeze could fuel additional gains. Short interest fell in the most recent reporting period, yet the 23.07 million shares sold short represents 14.7% of the stock's available float. At KMX's average pace of trading, it would take over nine days to buy back these bearish bets.

Options traders are targeting KMX today, with volume running at 11 times the intraday amount and pacing for the top percentile of its annual range. So far, 11,000 calls and 10,000 puts have crossed the tape, with the weekly 4/14 75-strike call the most popular.