America’s Carmart Buy Alert

America’s Carmart, Inc. (CRMT) is barreling forward and producing very impressive results for shareholders in a very challenging environment. The company’s fourth-quarter results, reported just last week, contained big improvements in both revenue and income from the same period last year. After the solid performance, shares of CRMT rallied and set a new 52-week high.

America’s Carmart, Inc. operates as an automotive retailer in the United States. At the end of 2007 the company operated a total of 92 stores, mostly in Souther states such as Arkansas and Oklahoma. America’s Car-Mart was founded in 1981, carries a market cap. of $225 million and is headquartered in Bentonville, Arkansas.

Awesome Fourth-Quarter Results

America’s Car-Mart’s share price has been bucking the overall trend of the market, advancing in the face of significant economic pressure. Much of this recent strength comes after the company’s excellent fourth-quarter results, reported on June 26.

Revenue grew to $76.5 million, a 29.2% increase from the same period last year. Net income totaled $6.05 million, a nice jump from last year’s $2.1 million. This produced earnings of 51 cents per share, blowing past analyst expectations of 28 cents per share.

A History of Beating Estimates

This is the fourth time in the last four quarters that the company has surprised and beaten estimates, having done so by an average of 11 cents, or 52%.

Estimates Are Up

After the solid quarter, the analyst community boosted their earnings estimates. The current-year estimates now stands at $1.40 per share, up from $1.21 only 30 days ago.

Valuations

Based upon this earnings projection, this stock looks reasonably priced, carrying a forward P/E multiple of 14X, about right in line with the overall market.

The Chart

CRMT got a nice jolt after the company reported strong fourth-quarter results on June 26, sending shares hurtling higher to a new 52-week high just above $19. As it stands, shares are pressuring a key level of resistance at $20, but have yet to breach this area and advance, Take a look at the chart below.

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