America's Car-Mart Inc. reported a strong third quarter for its 2015 fiscal year, crediting controlled growth for results beating analysts estimates for the third quarter in a row.
The Bentonville-based buy-here, pay-here, used-car dealer reported net income of $7.5 million or 82 cents per share for the third quarter that ended Jan. 31, compared with $1.5 million or 16 cents per share for the third quarter of 2014. The average of estimates of six analysts predicted earnings of 77 cents per share.
The company posted revenue of $132 million compared with $123 million for the third quarter of fiscal 2014. The average revenue estimate of three analysts came in at $127.9 million. Revenue at car lots open at least a year increased 2.8 percent for the quarter.
"Our decision a few years ago to continue to grow the business in a smart manner in the face of increased competitive pressure is certainly proving to be the right choice, and we are happy that so many more deserving customers will have the opportunity to succeed with Car-Mart," Hank Henderson, president and CEO of Car-Mart, said in a statement.
Shares closed at $52.82 in trading Wednesday on the Nasdaq, up $1.51 or nearly 3 percent. Shares have traded as low as $34.56 and as high as $55.64 over the past year. The results were released after the market closed.
Car-Mart has bested analysts estimates so far in fiscal 2015. The company failed to meet earnings estimates throughout its fiscal 2014.
In the third quarter of 2015, Car-Mart sold 11,495 vehicles, up 7.1 percent from 10,735 for the same quarter a year ago. The company averaged 28 vehicle sales per dealership per month during the quarter, up from 27.7 for the year earlier.
The average selling price was up $25 to $9,764, when compared to the third quarter in fiscal 2014.
In recent quarters, Henderson noted how fierce the competition was for the company's core customers, with many rival car lots showing a willingness to take risks by offering newer cars -- for longer terms -- to customers with weaker credit.
"While the competitive environment remains challenging, our sense is that financing offerings in our markets may be a little more rational now when compared to say 12 months ago," Jeff Williams, chief financial officer, said in a statement. "We are hopeful that we can get back to the point where customers in the markets we serve are presented competitive financing options that are in their best long-term interest, structured for their ultimate success."
Car-Mart operates 138 dealerships in 10 states.
Business on 02/19/2015