Peeling Back The Layers: Exploring Sonic Automotive Through Analyst Insights

In the latest quarter, 4 analysts provided ratings for Sonic Automotive SAH, showcasing a mix of bullish and bearish perspectives.

Summarizing their recent assessments, the table below illustrates the evolving sentiments in the past 30 days and compares them to the preceding months.

Analysts' evaluations of 12-month price targets offer additional insights, showcasing an average target of $65.25, with a high estimate of $73.00 and a low estimate of $58.00. This upward trend is apparent, with the current average reflecting a 3.57% increase from the previous average price target of $63.00.

Deciphering Analyst Ratings: An In-Depth Analysis

An in-depth analysis of recent analyst actions unveils how financial experts perceive Sonic Automotive. The following summary outlines key analysts, their recent evaluations, and adjustments to ratings and price targets.

Key Insights:

• Action Taken: In response to dynamic market conditions and company performance, analysts update their recommendations. Whether they 'Maintain', 'Raise', or 'Lower' their stance, it signifies their reaction to recent developments related to Sonic Automotive. This insight gives a snapshot of analysts' perspectives on the current state of the company.
• Rating: Analysts unravel qualitative evaluations for stocks, ranging from 'Outperform' to 'Underperform'. These ratings offer insights into expectations for the relative performance of Sonic Automotive compared to the broader market.
• Price Targets: Analysts provide insights into price targets, offering estimates for the future value of Sonic Automotive's stock. This comparison reveals trends in analysts' expectations over time.

Understanding these analyst evaluations alongside key financial indicators can offer valuable insights into Sonic Automotive's market standing. Stay informed and make well-considered decisions with our Ratings Table.

Stay up to date on Sonic Automotive analyst ratings.

Discovering Sonic Automotive: A Closer Look

Sonic Automotive is one of the largest auto dealership groups in the United States. The company has 108 franchised stores in 18 states, primarily in metropolitan areas in California, Texas, and the Southeast, plus 25 EchoPark used-vehicle stores, 16 collision centers, and 13 powersports locations. The franchise stores derive revenue from new and used vehicles plus parts and collision repair, finance, insurance, and wholesale auctions. Luxury and import dealerships make up about 86% of franchise new-vehicle revenue, while Honda, BMW, Mercedes, and Toyota constitute about 58% of new-vehicle revenue. BMW is the largest brand at about 25%. 2023's revenue was $14.4 billion, with EchoPark's portion totaling $2.4 billion. Sonic bought RFJ Auto in December 2021, which added $3.2 billion in sales.

Sonic Automotive's Economic Impact: An Analysis

Market Capitalization Analysis: Reflecting a smaller scale, the company's market capitalization is positioned below industry averages. This could be attributed to factors such as growth expectations or operational capacity.

Decline in Revenue: Over the 3 months period, Sonic Automotive faced challenges, resulting in a decline of approximately -5.47% in revenue growth as of 30 June, 2024. This signifies a reduction in the company's top-line earnings. In comparison to its industry peers, the company trails behind with a growth rate lower than the average among peers in the Consumer Discretionary sector.

Net Margin: Sonic Automotive's net margin surpasses industry standards, highlighting the company's exceptional financial performance. With an impressive 1.19% net margin, the company effectively manages costs and achieves strong profitability.

Return on Equity (ROE): Sonic Automotive's ROE surpasses industry standards, highlighting the company's exceptional financial performance. With an impressive 4.46% ROE, the company effectively utilizes shareholder equity capital.

Return on Assets (ROA): Sonic Automotive's financial strength is reflected in its exceptional ROA, which exceeds industry averages. With a remarkable ROA of 0.73%, the company showcases efficient use of assets and strong financial health.

Debt Management: Sonic Automotive's debt-to-equity ratio is below the industry average at 4.44, reflecting a lower dependency on debt financing and a more conservative financial approach.

Analyst Ratings: What Are They?

Analyst ratings serve as essential indicators of stock performance, provided by experts in banking and financial systems. These specialists diligently analyze company financial statements, participate in conference calls, and engage with insiders to generate quarterly ratings for individual stocks.

Analysts may supplement their ratings with predictions for metrics like growth estimates, earnings, and revenue, offering investors a more comprehensive outlook. However, investors should be mindful that analysts, like any human, can have subjective perspectives influencing their forecasts.

This article was generated by Benzinga's automated content engine and reviewed by an editor.