Giverny Capital Asset Management Exited Its Long-Term Holding CarMax (KMX) in 2025

Giverny Capital Asset Management, LLC, an investment management company, recently published its fourth-quarter 2025 investor letter. A copy of the same can be downloaded here. The Portfolio returned 0.01% compared to 2.66% for the S&P 500. YTD, the fund returned 12.58% compared to 17.88% for the Index. The firm faced a challenging fourth quarter and calendar year, despite solid appreciation. The outperformance of a few large technology companies has negatively impacted performance, given the portfolio’s underweight in large tech and overweight in smaller niche leaders. While portfolio companies are excelling in earnings growth and capital returns, the market is fixated on AI investments, leaving the actual benefits unclear. Additionally, you can review the Portfolio’s top 5 holdings to see its best picks for 2025.

In its fourth-quarter 2025 investor letter, Giverny Capital Asset Management highlighted CarMax, Inc. (NYSE:KMX), which it exited during the year. CarMax, Inc. (NYSE:KMX) is a used vehicle retailer headquartered in Richmond, Virginia. The one-month return of CarMax, Inc. (NYSE:KMX) was 15.88%, and its shares lost 46.84% of their value over the last 52 weeks. On January 29, 2026, CarMax, Inc. (NYSE:KMX) stock closed at $45.53 per share, with a market capitalization of $6.686 billion.

Giverny Capital Asset Management stated the following regarding CarMax, Inc. (NYSE:KMX) in its fourth quarter 2025 investor letter:

“CarMax, Inc. (NYSE:KMX): Selling this stock after years of ownership represented for me a disappointing end to a tumultuous relationship. A lot of things went wrong for CarMax these past few years, but management also hurt itself by refusing to adapt to industry conditions. CarMax spent years and vast sums of money building out an omnichannel experience that let consumers buy a used car in store or online, or to do parts of the transaction online and parts in the store. The idea was to be as convenient online as rival Carvana while retaining a physical presence for test drives, browsing, dropping off trade-ins, etc.

It has not worked. CarMax now has a good omnichannel offering but has not gained market share. Instead, it added to its expense structure. Worse, since the pandemic began the price of used cars has soared and interest rates have risen, creating an a ordability crisis. Consumers are holding their cars longer, shrinking the size of the used car market – especially for cars aged 2-5 years, CarMax’s sweet spot…” (Click here to read the full text)

In another article, we covered CarMax, Inc. (NYSE:KMX) and shared Vulcan Value Partners’ views on the company. In addition, please check out our hedge fund investor letters Q4 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.