CVNA vs KMX: Which Is the Better Buy in 2026?
Last updated August 2026
Short answer
CVNA and KMX are similarly sized, but KMX trades noticeably cheaper on forward earnings (18.67x vs 27.69x): the market is paying up for CVNA's profile and pricing KMX more conservatively, or for faster growth. Which you prefer comes down to the drivers you believe, and whether adding either over-concentrates what you already own.
CVNA vs KMX: the tie-breaker metrics
Same yardstick, side by side (as of August 2026). Valuation lined up like this is most meaningful for two names in the same corner of the market, which these are. Figures are approximate; verify before investing.
| Metric | CVNA | KMX | What it tells you |
|---|---|---|---|
| Forward P/E | 27.69 | 18.67 | Valuation on next year's expected earnings, the same yardstick for both. Lower is cheaper for that growth; higher means the market is paying up. |
| Trailing P/E | 32.99 | 35.57 | Valuation on the last 12 months. A big drop from trailing to forward means the market expects earnings to jump, so more growth is already in the price. |
| Beta | 3.46 | 1.16 | Volatility vs the market. Above 1 swings harder than the index; below 1 is steadier. Higher beta means bigger drawdowns to hold through. |
| Price vs 52-week range | 18% of range | 84% of range | Where today's price sits between the 52-week low and high. Near the high is momentum with less margin of safety; near the low is out of favor or a discount, depending on why. |
| Price / book | 11.13 | 1.33 | How much you pay over book value. Very high can signal an asset-light, high-return business or a rich price. |
Reading it: KMX is the cheaper of the two on forward earnings, but cheaper is not the same as better. Pair the valuation with growth (how far the forward P/E sits below the trailing P/E) and risk (beta) before you decide.
Before you buy: how CVNA and KMX affect your concentration
The metrics above tell you which is the marginally better business. The bigger risk for most people is not picking the slightly worse stock, it is over-concentrating. CVNA and KMX share themes, so owning both, or adding either to what you already hold, can quietly push a large share of your portfolio into one bet.
This is the part a generic comparison page cannot answer, because it depends on what you own. Connect your brokerage and Walnut shows your real, combined CVNA and KMX exposure, flags overlap with your existing positions, and tells you if adding one would tip you past a concentration you are comfortable with, read-only by default, with your login staying at your broker. Walnut is not an investment adviser.
What does Carvana (CVNA) do?
Carvana sells used cars entirely online. A buyer browses inventory, gets financing, trades in an old vehicle, and either has the car delivered or picks it up from one of the company's signature glass-tower vending machines. The business makes money three ways: gross profit per retail unit on the cars themselves, financing and loan-sale income from arranging auto loans, and a wholesale and auction layer powered by ADESA, the physical auction network Carvana bought from KAR Global in May 2022 for about $2.2 billion. ADESA's mega-centers let Carvana recondition cars at scale and sell non-retail inventory to other dealers, capturing margin across the lifecycle of a vehicle.
What does CarMax (KMX) do?
CarMax, Inc. operates the largest used-vehicle retail business in the United States, selling used cars and light trucks through a network of physical stores paired with an omnichannel platform that lets customers browse, finance, and buy online, in store, or in a mix of both. The company makes money three ways: gross profit on retail used-vehicle sales, wholesale profit from selling trade-ins and auction vehicles it does not retail, and financing income through CarMax Auto Finance (CAF), its captive lender. Its no-haggle pricing model and scale in sourcing and reconditioning have long been its structural advantages in a highly fragmented market dominated by small independent dealers.
CVNA vs KMX: how do they differ?
Both fit overlapping themes, but they are not interchangeable. The useful comparison is which set of drivers and risks you want exposure to.
- CVNA drivers: Retail unit growth; Gross profit per unit.
- KMX drivers: Used-vehicle demand and affordability; Omnichannel and market-share gains.
Which fits which kind of investor
A faster-growing, richer-valued name usually swings harder, so it suits a longer horizon and a higher tolerance for volatility; a steadier, more cash-generative business suits a more conservative or income-minded investor. The honest test is which set of risks you could hold through a drawdown: The bear case starts with the balance sheet: Carvana still carries around $4.8 billion of long-term debt and secured notes that come due between 2028 and 2031, so a downturn would be felt sharply. For KMX, carMax is highly cyclical and sensitive to consumer spending, so a weak economy or job market can quickly cut used-car demand.
CVNA or KMX: which should you pick?
CVNA vs KMX: the full fundamentals
CVNA. These figures are approximate and tied to the asOf date; Carvana reports quarterly, so units, GPU, and margin move with each release. The headline story is rapid growth on top of a recovered balance sheet, but the multiples sit well above traditional auto retailers, meaning the market is pricing in continued strong execution. Treat the valuation line as a snapshot rather than a fixed number, since the stock has been volatile.
KMX. CarMax's most recent quarter (ended May 2026) showed revenue of about $8.0 billion, up roughly 6% year over year, with EPS around $1.31, aided by higher average selling prices and wholesale volume even as comparable-store used-unit sales were roughly flat to slightly down. The market cap of about $7.3 billion is well below its pandemic-era peak, and the trailing P/E has ranged from the mid-20s to low-30s, above its longer-run historical average. All figures are approximate and as of JULY 2026.
Headline figures (approximate, 2026-06-27): CVNA shows revenue (ttm, approx) ~$19 billion, retail units (q1 2026) ~187,000, up ~40% YoY, adjusted ebitda (q1 2026) ~$672 million, adjusted ebitda margin ~10.4%; KMX shows revenue (annual) ~$26B, recent quarter revenue (ended may 2026) ~$8.0B, recent quarter revenue growth (yoy) ~+6%, recent quarter eps ~$1.31.
The bottom line: CVNA vs KMX
CVNA and KMX are related but distinct: same themes, different businesses and risks. Neither wins in the abstract; the right pick is whichever thesis you actually believe, sized so you are not over-concentrated in one theme. Walnut can show your combined CVNA and KMX exposure against your real portfolio. It is not an investment adviser.
Wondering how CVNA or KMX fits the portfolio you already own? Walnut is an AI investing app that connects your brokerage read-only and answers questions like that about your actual holdings: overlap, concentration, and how each position tracks the S&P 500. Compare the best AI portfolio analyzers or see the best AI investing apps in 2026.
Investing in Carvana with AI
Connect the broker you already use and ask Walnut's AI how CVNA fits what you actually hold: whether you own it already through a fund, what it would do to your concentration, and how it has tracked the S&P 500. Read-only by default, and you approve anything before it reaches your broker.
FAQ
What is the difference between CVNA and KMX?
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Carvana sells used cars entirely online. CarMax, Inc. They show up together because they share investment themes, but they are different businesses, so the better fit depends on which thesis you are expressing.
Is CVNA or KMX the better stock?
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Neither is universally better; they suit different views and risk levels. Walnut is informational, not investment advice. Compare what each does, the tie-breaker metrics above, and the risks, then decide which fits your thesis and what you already own.
Which is cheaper, CVNA or KMX?
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On forward P/E (as of August 2026), CVNA trades at 27.69x and KMX at 18.67x, so KMX is the cheaper of the two on next year's expected earnings. A lower multiple is not automatically the better buy: a richer valuation can be justified by faster growth, and a lower one can reflect real risk. Weigh the multiple against how fast each business is compounding.
Should you own both CVNA and KMX?
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Because they share themes, owning both concentrates you in that theme. That can be intentional (a focused bet) or accidental (less diversification than it looks). Walnut can show your combined exposure across both, and whether adding either over-concentrates you, before you buy.
What are the risks of CVNA vs KMX?
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CVNA: The bear case starts with the balance sheet: Carvana still carries around $4.8 billion of long-term debt and secured notes that come due between 2028 and 2031, so a downturn would be felt sharply. Valuation is the second concern. The stock trades at a high multiple (a price-to-earnings ratio in the dozens and an enterprise-value-to-EBITDA multiple well above traditional retailers), which leaves little room for disappointment. Used-car prices and demand are cyclical, and a drop in either can squeeze gross profit per unit quickly. Finally, the Garcia family's control and historical related-party dealings (including with DriveTime) have drawn governance and accounting scrutiny that some investors weigh heavily. KMX: CarMax is highly cyclical and sensitive to consumer spending, so a weak economy or job market can quickly cut used-car demand. Elevated vehicle prices and interest rates have pressured affordability and comparable-store sales, and average used selling prices have been volatile. The CAF finance arm adds credit risk if loan losses rise in a downturn. Competition is intense from online players like Carvana and from franchise-dealer groups such as AutoNation and Lithia Motors. The stock has also been volatile, with the market cap having swung sharply, and valuation multiples have at times looked rich relative to the company's own history.
Walnut is informational, not investment advice. This page is descriptive and not a recommendation to buy or sell CVNA or KMX; figures are approximate and dated (as of August 2026). Verify current data before investing.