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CHH vs KMX

CHH
Choice Hotels International, Inc.
BEARISH
Price
$119.07
Market Cap
$5.45B
Sector
Consumer Cyclical
AI Confidence
85%
KMX
CarMax, Inc.
BEARISH
Price
$38.64
Market Cap
$5.48B
Sector
Consumer Cyclical
AI Confidence
85%

Valuation

P/E Ratio
CHH
15.07
KMX
23.0
Forward P/E
CHH
15.38
KMX
13.83
P/B Ratio
CHH
29.99
KMX
0.93
P/S Ratio
CHH
5.56
KMX
0.2
EV/EBITDA
CHH
14.65
KMX
23.21

Profitability

Gross Margin
CHH
90.65%
KMX
12.14%
Operating Margin
CHH
45.0%
KMX
1.81%
Profit Margin
CHH
37.73%
KMX
0.89%
ROE
CHH
544.21%
KMX
4.08%
ROA
CHH
10.42%
KMX
1.61%

Growth

Revenue Growth
CHH
2.4%
KMX
-1.2%
Earnings Growth
CHH
-13.6%
KMX
--

Financial Health

Debt/Equity
CHH
11.16
KMX
3.18
Current Ratio
CHH
0.87
KMX
2.2
Quick Ratio
CHH
0.57
KMX
0.14

Dividends

Dividend Yield
CHH
0.97%
KMX
--
Payout Ratio
CHH
14.56%
KMX
0.0%

AI Verdict

CHH BEARISH

The company exhibits significant financial fragility, evidenced by a weak Piotroski F-Score of 3/9 and a precarious Debt/Equity ratio of 11.16. Valuation is severely stretched, with the current price of $119.07 trading at a massive premium to both the Graham Number ($26.45) and the Intrinsic Value ($54.81). While profit margins remain high, negative earnings growth (-13.6% YoY) and poor liquidity (Current Ratio 0.87) signal operational distress. Combined with bearish insider activity and a 0/100 technical trend, the risk-reward profile is highly unfavorable.

Strengths
Exceptionally high gross margins (90.65%)
Strong operating margins (45.00%)
High Return on Assets (10.42%)
Risks
Extreme leverage with a Debt/Equity ratio of 11.16
Liquidity risk indicated by a Current Ratio of 0.87 and Quick Ratio of 0.57
Negative earnings growth (-13.6% YoY and -16% Q/Q)
KMX BEARISH

KMX exhibits a fragile financial profile characterized by a stable but mediocre Piotroski F-Score of 4/9 and a concerning lack of liquidity as evidenced by a Quick Ratio of 0.14. While the stock trades near its Graham Number ($39.62) and below book value (P/B 0.93), these value metrics are offset by severe earnings deterioration, with YoY EPS growth plummeting by 41.4%. The combination of high leverage (Debt/Equity 3.18), razor-thin profit margins (0.89%), and a 0/100 technical trend suggests a value trap rather than a value opportunity.

Strengths
Trading below book value (P/B 0.93)
Low Price-to-Sales ratio (0.20)
Low PEG ratio (0.64) suggesting potential undervaluation relative to forward growth
Risks
Severe earnings contraction with YoY EPS growth of -41.4%
Critical liquidity risk indicated by a Quick Ratio of 0.14
High financial leverage with a Debt/Equity ratio of 3.18

Compare Another Pair

CHH vs KMX: Head-to-Head Comparison

This page compares Choice Hotels International, Inc. (CHH) and CarMax, Inc. (KMX) across key fundamental metrics including valuation ratios, profitability margins, growth rates, financial health indicators, and dividend metrics. Each metric highlights the better-performing stock so you can quickly identify relative strengths and weaknesses.

Our AI engine independently analyzes each company's financials, competitive position, and market conditions to produce a verdict (Bullish, Neutral, or Bearish) along with key strengths and risks. Use this comparison alongside your own research to make informed investment decisions.

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