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Sonic Automotive's (SAH) Q3 Earnings In Line, Down Y/Y

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Sonic Automotive Inc. (SAH - Free Report) registered adjusted earnings per share of 40 cents in third-quarter 2017 compared with 47 cents in the year-ago quarter. However, earnings came in line with the Zacks Consensus Estimate.

Total revenues in the reported quarter decreased 2% to $2.51 billion. The figure also missed the Zacks Consensus Estimate of $2.53 billion.

Revenues from total new vehicles declined 0.9% year over year to $1.36 billion. Revenues from used vehicles decreased 0.2% to $659.7 million in the quarter. Wholesale vehicle revenues dropped 38.9% to $43.1 million. Revenues from parts, service and collision repair decreased 3.9% to $347.7 million, while finance, insurance and other revenues grew 3.7% to $92.9 million.

Gross profit increased to $362.6 million in the reported quarter from $359.1 million a year ago. Selling, general and administrative expenses increased to $284 million from $282.1 million in the year-ago quarter. The company reported operating income of $55.8 million compared with $0.97 million in the year-ago quarter.

Dividend Update

The board of directors at Sonic Automotive announced a quarterly dividend of 5 cents per share. The dividend will be paid on Jan 12, 2018, to shareholders on record as of Dec 15, 2017.

Business Update

During the quarter, the company’s EchoPark units retailed rose 37.7% year over year. Also, the company has plans of opening another 10 EchoPark stores by the end of 2018.

During the quarter, all stores in the Houston market had to be closed for around a week due to hurricane Harvey.

Sonic Automotive, Inc. Price, Consensus and EPS Surprise

Sonic Automotive, Inc. Price, Consensus and EPS Surprise | Sonic Automotive, Inc. Quote

2017 Outlook

Sonic Automotive expects adjusted earnings per share in 2017 in the band of $1.85-$1.95 per share.

Sonic Automotive currently carries a Zacks Rank #5 (Strong Sell).

Some better-ranked stocks in the auto space include Fox Factory Holding Corp (FOXF - Free Report) , PACCAR Inc (PCAR - Free Report) and Fiat Chrysler Automobiles N.V. , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1(Strong Buy) Rank stocks here.

Fox Factory Holding, PACCAR and Fiat Chrysler have a long-term expected earnings growth rate of 14.2%, 10% and 19.1%, respectively.

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