AutoNation Q2 Earnings Top Estimates; Plans $1B Stock Buyback

AutoNation Inc AN reported a second-quarter FY22 sales decline of 2% year-on-year to $6.87 billion, beating the consensus of $6.84 billion.
New vehicle revenue declined 14%, while used vehicle revenue increased 13%.
Segment income from Domestic fell 9% Y/Y, Import dropped 5%, and Premium Luxury rose 14%.
Gross profit improved 3% Y/Y to $1.4 billion, and the gross profit margin expanded 80 basis points Y/Y to 19.8%. After-Sales gross profit increased 11% to $482 million.
Selling, general and administrative (SG&A) expenses increased by 0.8%.
The operating margin for the quarter was 8.1%, and operating income was $558.1 million, a 5.3% Y/Y increase.
EPS of $6.48 beat the consensus of $6.06.
Buyback: AN Board authorized up to an additional $1 billion of stock repurchase.
Acquisition: AutoNation agreed to acquire CIG Financial, an auto finance company based in Irvine, California. Financial details were not disclosed. This acquisition enhances the company's used vehicle business.
Cash and equivalents totaled $336.5 million as of June 30, 2022.
Price Action: AN shares are trading lower by 3.49% at $117.92 on the last check Thursday.