AutoNation Inc. (AN - Free Report) witnessed an outstanding performance in new vehicle sales in June 2012 compared with the corresponding month last year. Sales in the month soared 38% year over year to 22,862 vehicles. The hike was attributable to higher demand for imported vehicles along with higher sales across all segments.
Sales in the Domestic segment escalated 25% to 7,066 vehicles. The segment comprises retail automotive franchises that sell vehicles manufactured by Ford Motor Co. (F - Free Report) , General Motors Company (GM - Free Report) and Chrysler.
Sales in the Import segment surged 56% to 11,579 vehicles. The segment comprises retail automotive franchises that sell vehicles produced by Toyota Motor Corp. (TM - Free Report) , Honda Motor Co. (HMC - Free Report) and Nissan Motor Co. (NSANY - Free Report) .
Sales in the Premium Luxury segment boosted 20% to 4,217 vehicles during the month. The segment consists of retail automotive franchises selling vehicles manufactured by Daimler AG’s (DDAIF - Free Report) Mercedes Benz, BMW and Lexus.
AutoNation has recorded a 12% rise in new vehicle sales to 20,534 units in April 2012 and 45% growth in sales to 23,763 units in May 2012. The company registered nearly 31% increase in new vehicle sales in the second quarter of 2012. Domestic segment sales jumped 18%, Import segment sales went up 47% and Premium Luxury segment sales shot up 18% in the second quarter.
Auto sales in the U.S. recovered drastically in June 2012. Seasonally adjusted annual rate (SAAR) went up 22% to 14.1 million vehicles, according to Autodata Corp. The major factors behind this remarkable improvement are lower gas prices, low interest rates and driving demand. Besides, merchandising promotions (such as zero-interest loans) and price incentives ahead of Independence Day also encouraged consumers to buy new vehicles.
Headquartered in Fort Lauderdale, Florida, AutoNation is the largest automotive retailer in the U.S. The company owns and operates about 260 new vehicle franchises that sell 32 brands located in the major metropolitan markets in 15 states. The company offers an array of automotive products and services, ranging from new vehicles, used vehicles, vehicle maintenance and repair services, vehicle parts, vehicle protection products to other aftermarket products.
Currently, AutoNation retains a Zacks #2 Rank, which translates into a short-term (1 to 3 months) Buy rating. We have a long-term (more than 6 months) Neutral recommendation on the stock.