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AutoNation Inc. (AN - Free Report) reported second-quarter 2020 adjusted earnings of $1.41 per share, which beat the Zacks Consensus Estimate of 36 cents. Higher-than-expected revenues from new and used vehicle sales led to the outperformance. Precisely, revenues from new and used vehicles came in at $2.26 billion and $1.32 billion, surpassing the Zacks Consensus Estimate of $1.97 billion and $1.01 billion, respectively.
The bottom line also increased from the year-ago quarter’s $1.20 per share on the back of operational efficiency. SG&A expenses came in at $547.9 million, lower than $637 million in the prior-year quarter.
During the reported quarter, AutoNation’s revenues amounted to $4,533 million compared with $5,343.8 million recorded in the prior-year period. However, the top line surpassed the Zacks Consensus Estimate of $4,039 million.
Same-store revenues and gross profit decreased 13.8% and 9.4% year over year to $4,532.6 million and $795.2 million, respectively.
During the quarter under review, new-vehicle revenues declined 18.4% year over year to $2,261.3 million. Used-vehicle revenues also fell 4% from the year-ago figure to $1,324.5 million. Revenues from the parts and service business slid 23.5% from the prior-year quarter to $689.9 million. Net revenues in the finance and insurance business amounted to $246.4 million, down 3.4% from the prior-year quarter.
Despite coronavirus woes, the company is not pulling back on store expansion. Importantly, AutoNation announced planned expansion of stand-alone pre-owned vehicle sales and service centers in the United States. It plans to build at least 20 additional stores over the next three years. The automotive retailer has sharpened focus on ramping up digital capabilities in response to the changing buying behaviors of consumers amid the pandemic.
AutoNation, Inc. Price, Consensus and EPS Surprise
Revenues in the Domestic segment declined 13% year over year to $1,486 million. The segment’s income increased 24.6% year over year to $82.1 million in the quarter under review. The segment comprises stores that sell vehicles manufactured by General Motors, Ford and FCA US.
Revenues in the Import segment were down 18.6% from the prior-year quarter to $1,325.3 million. The segment’s income was up 8.5% year over year to $88.3 million in the reported quarter. The segment consists of outlets that sell vehicles manufactured primarily by Toyota, Honda, Subaru, Hyundai and Nissan.
The Premium Luxury segment comprises stores that sell retail vehicles manufactured by Mercedes-Benz, BMW, Lexus, Jaguar Land Rover and Audi. Sales in the segment fell 14.1% from a year ago to $1,564.8 million. Segmental income also slipped 6.4% year over year to $89.2 million in the reported quarter.
Financials
AutoNation’s cash and cash equivalents were $257.3 million as of Jun 30, 2020. The company’s inventory was valued at $2,432.3 million. At second quarter-end, non-vehicle debt was $2,090.4 million, down from $2,440.1 million in the comparable prior-year period. Capital expenditure during the quarter amounted to $24.6 million. Amid coronavirus-led uncertainty and financial crisis, AutoNation has tapped brakes on the share repurchase program.
Zacks Rank & Other Stocks to Consider
AutoNation currently carries a Zacks Rank #1 (Strong Buy).
From thousands of stocks, 5 Zacks experts each picked their favorite to gain +100% or more in months to come. From those 5, Zacks Director of Research, Sheraz Mian hand-picks one to have the most explosive upside of all.
With users in 180 countries and soaring revenues, it’s set to thrive on remote working long after the pandemic ends. No wonder it recently offered a stunning $600 million stock buy-back plan.
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Image: Bigstock
AutoNation (AN) Q2 Earnings Impress, Expansion Plans Intact
AutoNation Inc. (AN - Free Report) reported second-quarter 2020 adjusted earnings of $1.41 per share, which beat the Zacks Consensus Estimate of 36 cents. Higher-than-expected revenues from new and used vehicle sales led to the outperformance. Precisely, revenues from new and used vehicles came in at $2.26 billion and $1.32 billion, surpassing the Zacks Consensus Estimate of $1.97 billion and $1.01 billion, respectively.
The bottom line also increased from the year-ago quarter’s $1.20 per share on the back of operational efficiency. SG&A expenses came in at $547.9 million, lower than $637 million in the prior-year quarter.
During the reported quarter, AutoNation’s revenues amounted to $4,533 million compared with $5,343.8 million recorded in the prior-year period. However, the top line surpassed the Zacks Consensus Estimate of $4,039 million.
Same-store revenues and gross profit decreased 13.8% and 9.4% year over year to $4,532.6 million and $795.2 million, respectively.
During the quarter under review, new-vehicle revenues declined 18.4% year over year to $2,261.3 million. Used-vehicle revenues also fell 4% from the year-ago figure to $1,324.5 million. Revenues from the parts and service business slid 23.5% from the prior-year quarter to $689.9 million. Net revenues in the finance and insurance business amounted to $246.4 million, down 3.4% from the prior-year quarter.
Despite coronavirus woes, the company is not pulling back on store expansion. Importantly, AutoNation announced planned expansion of stand-alone pre-owned vehicle sales and service centers in the United States. It plans to build at least 20 additional stores over the next three years. The automotive retailer has sharpened focus on ramping up digital capabilities in response to the changing buying behaviors of consumers amid the pandemic.
AutoNation, Inc. Price, Consensus and EPS Surprise
AutoNation, Inc. price-consensus-eps-surprise-chart | AutoNation, Inc. Quote
Segmental Details
Revenues in the Domestic segment declined 13% year over year to $1,486 million. The segment’s income increased 24.6% year over year to $82.1 million in the quarter under review. The segment comprises stores that sell vehicles manufactured by General Motors, Ford and FCA US.
Revenues in the Import segment were down 18.6% from the prior-year quarter to $1,325.3 million. The segment’s income was up 8.5% year over year to $88.3 million in the reported quarter. The segment consists of outlets that sell vehicles manufactured primarily by Toyota, Honda, Subaru, Hyundai and Nissan.
The Premium Luxury segment comprises stores that sell retail vehicles manufactured by Mercedes-Benz, BMW, Lexus, Jaguar Land Rover and Audi. Sales in the segment fell 14.1% from a year ago to $1,564.8 million. Segmental income also slipped 6.4% year over year to $89.2 million in the reported quarter.
Financials
AutoNation’s cash and cash equivalents were $257.3 million as of Jun 30, 2020. The company’s inventory was valued at $2,432.3 million. At second quarter-end, non-vehicle debt was $2,090.4 million, down from $2,440.1 million in the comparable prior-year period. Capital expenditure during the quarter amounted to $24.6 million. Amid coronavirus-led uncertainty and financial crisis, AutoNation has tapped brakes on the share repurchase program.
Zacks Rank & Other Stocks to Consider
AutoNation currently carries a Zacks Rank #1 (Strong Buy).
Other top-ranked stocks in the same sector include Lithia Motors (LAD - Free Report) , Sonic Automotive (SAH - Free Report) and Asbury Automotive Group Inc. (ABG - Free Report) , each carrying a Zacks Rank of 1 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Zacks’ Single Best Pick to Double
From thousands of stocks, 5 Zacks experts each picked their favorite to gain +100% or more in months to come. From those 5, Zacks Director of Research, Sheraz Mian hand-picks one to have the most explosive upside of all.
With users in 180 countries and soaring revenues, it’s set to thrive on remote working long after the pandemic ends. No wonder it recently offered a stunning $600 million stock buy-back plan.
The sky’s the limit for this emerging tech giant. And the earlier you get in, the greater your potential gain.
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