Why CarMax Couldn't Cash in on Soaring Car Prices

Vehicles are getting far more expensive. But CarMax (NYSE: KMX), one of the country's biggest used-car retailers, is struggling with declining sales volumes and falling earnings.

That apparent contradiction caught investors' attention this past week as CarMax reported its Q1 earnings results. While revenue is rising thanks to soaring prices, the chain is seeing mounting pressures on its customer traffic that all point to a weaker selling environment ahead.

Let's dive right in and see what this all means for investors.

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Source Fool.com