America's Car-Mart Stock Plunges After Sales Volume Dip, Delinquency Uptick
On Thursday, America's Car-Mart, Inc. (NASDAQ:CRMT) shares traded lower after the company reported first-quarter results.
The company reported a first-quarter loss of 69 cents per share, compared with a net loss of 15 cents per share in the year-ago period.
Quarterly sales of $341.312 million (down 1.9% year over year) missed the Street view of $359.208 million, driven by fewer retail units sold.
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"From a consumer demand standpoint, application volume was up over 10%. We deployed and implemented LOS V2 in the beginning of the quarter, which has a more advanced underwriting scorecard, and the enablement of risk-based pricing embedded within the tool," said President and CEO Doug Campbell.
The allowance for credit losses declined to 23.35%, compared with 25.00% as at July 31, 2024.
The average down payment was 4.9% of the retail sales price, down from 5.2% in the first quarter of the prior year. The average originating term was 44.9 months, up 0.6 months from the prior year's first quarter.
Delinquencies (30+ days) were 3.8% at the end of the quarter, which represented a 30 basis points increase over the prior year quarter.
"During the quarter credit applications from our customers that fall within on our top three customer credit rankings grew by 790 basis points, or 15% during the quarter when compared against fiscal year 2025 average," Campbell said.
In the first quarter, America's Car-Mart sales volumes fell 5.7% to 13,568 units.
Interest income rose by $4.6 million, or 7.5%. Total collections climbed 6.2% to $183.6 million.
Gross margin improved by 160 basis points to 36.6%. Continued efforts in vehicle pricing and strong ancillary product attachment rates drove these gains.
Net charge-offs as a percentage of average finance receivables were 6.6%, up slightly from 6.4%. Interest expense decreased by 6.9%.
The company exited the quarter with cash and equivalents worth $9.66 million. Inventory as of quarter end totaled $112.451 million.
Price Action: CRMT shares are trading lower by 22.28% to $34.70 at last check Thursday.
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