Back to top

Analyst Blog

Sonic Automotive (SAH - Snapshot Report) reported adjusted earnings per share of 50 cents in the second quarter of the year, which was up 11.1% from 45 cents a year ago but missed the Zacks Consensus Estimate by a penny. Earnings per share rose despite a 7.2% fall in net earnings to $26.4 million in the quarter due to lower outstanding shares compared with the 2012-second quarter.

Total revenue for the quarter rose 3.8% to $2.2 billion. Of this, revenue from vehicle trade increased 3.6% to $1.8 billion. Meanwhile, revenue from Parts, service and collision repair went up 4.0% to $307.0 million and from Finance, insurance and other services grew 8.6% to $69.2 million.

Revenue from new vehicles retail escalated 5.2% to $1.2 billion. New vehicle retail units increased 1.7% to 33,685 vehicles. However, new vehicle gross margins declined to 5.4% from 5.9% in the year-ago quarter.
 
Revenue from used vehicles retail rose marginally by about 1% to $539.0 million. Used vehicle unit volume rose marginally to 26,599 vehicles. However, gross margin improved to 7.0% from 6.7% in the year ago period.

Total gross margin remained flat at 14.7% in the quarter while overall operating margin decreased to 2.8% from 2.9% a year ago.

Sonic Automotive announced the acquisition of Murray Mercedes Benz of Denver and Murray BMW of Denver in May. These acquisitions are expected to close in the third quarter of the year.

Charlotte, N. C. based Sonic Automotive is a Fortune 500 company. It is one of the largest automotive retailers in the U.S. The company currently operates 100 dealerships spread across 14 states and 25 major metropolitan markets. It represents about 25 different automotive brands with the majority of the dealerships being luxury and import brands.

Sonic Automotive reiterated its guidance of earnings per share from continuing operations between $1.93 and $2.03 for the full year 2013. Currently, SAH retains a Zacks Rank #3 (Hold).

Other stocks that are performing well in the automotive retail industry include Asbury Automotive Group, Inc. (ABG - Snapshot Report), Lithia Motors (LAD - Snapshot Report) and Group 1 Automotive Inc. (GPI - Snapshot Report). Asbury Automotive and Lithia Motors are Zacks Rank #1 (Strong Buy) stocks while Group 1 Automotive is a Zacks Rank #2 (Buy) stock.
 

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
RPC INC RES 24.91 +8.35%
LITHIA MOTO… LAD 94.59 +4.60%
DELTA AIR L… DAL 39.15 +3.90%
FLAMEL TECH… FLML 14.51 +3.50%
SOUTHWEST A… LUV 28.87 +2.92%