(Updates with stock price, details)
DETROIT, Sept 22 (Reuters) - Auto retailer CarMax Inc. on Monday said its quarterly earnings rose 25 percent, boosted by stronger used and wholesale vehicle sales and higher service profits.
But shares of the Richmond, Virginia, company were down nearly 6 percent after it said its fiscal third quarter earnings per share would be in the range of 19 cents to 21 cents, below Wall Street estimates of 22 cents a share, according to Thomson First Call.
In a statement, CarMax President and Chief Executive Officer Austin Ligon said the estimated impact of Hurricane Isabel and somewhat softer-than-expected sales in early September caused the company to lower its expectations for used vehicle sales growth at existing stores to a range of 4 percent to 6 percent, from a previous estimate of 5 percent to 7 percent.
Ligon said CarMax expected to regain some of the sales lost to Hurricane Isabel, and projected full-year income in a range of $1.11 to $1.16 per share, compared with Wall Street's estimate of $1.15 per share.
CarMax shares were down $2.02 at $33.91 in morning trading on the New York Stock Exchange. CarMax's shares have soared this year, outperforming the Standard & Poor's 500 Index by 64 percent since the beginning of the year.
Net income in the fiscal second quarter ended Aug. 31 rose to $39.6 million, or 37 cents per share, compared with a profit of $31.7 million, or 30 cents per share, in the year-ago quarter.
CarMax earlier this month said it expected earnings of 36 cents per share, up from its previous forecast of 33 cents to 35 cents per share.
Ligon said the company was able to beat its estimate thanks to higher unit sales, higher transaction prices and better margins on repairs, offset in part by lower-than-expected income from financing vehicle sales.