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Asbury
(NYSE:ABG)
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Rating:65Neutral
Price Target:
$244.00
▲(8.33% Upside)
Action:Reiterated
Date:07/28/26
The score is driven primarily by solid (but cooling) financial performance with strong free cash flow, balanced against revenue contraction and leverage risk. Valuation is supportive with a low P/E, and technicals are constructive with price above key moving averages. The earnings call adds a moderately positive outlook due to Tekion-driven productivity/SG&A improvement and buybacks, tempered by near-term conversion and volume headwinds.
Positive Factors
Cash generation
TTM free cash flow grew double-digits and FCF is sizable versus earnings (roughly three-quarters to near parity), providing durable financial flexibility. Strong cash conversion funds capex, buybacks and working capital, cushioning the business through cyclical auto cycles.
Negative Factors
Elevated leverage
Transaction-adjusted net leverage at ~3.4x versus a 3.0x target reflects meaningful balance-sheet risk for a cyclical dealership model. Higher leverage reduces flexibility for downturns, amplifies earnings volatility and constrains strategic optionality until deleveraging occurs.
Read all positive and negative factors
Positive Factors
Negative Factors
Cash generation
TTM free cash flow grew double-digits and FCF is sizable versus earnings (roughly three-quarters to near parity), providing durable financial flexibility. Strong cash conversion funds capex, buybacks and working capital, cushioning the business through cyclical auto cycles.
Read all positive factors
Asbury (ABG) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$4.31B
Dividend YieldN/A
Average Volume (3M)242.02K
Price to Earnings (P/E)8.7
Beta (1Y)0.97
Revenue Growth4.12%
EPS Growth-2.47%
CountryUS
Employees15,000
SectorConsumer Cyclical
Sector Strength84
IndustryAuto - Dealerships
Share Statistics
EPS (TTM)26.78
Shares Outstanding18,618,800
10 Day Avg. Volume228,395
30 Day Avg. Volume242,019
Financial Highlights & Ratios
PEG Ratio0.54
Price to Book (P/B)1.16
Price to Sales (P/S)0.25
P/FCF Ratio7.92
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$235.00Price Target Upside4.33% Upside
Rating ConsensusHold
Number of Analyst Covering5
EPS Forecast (FY)26.17
Revenue Forecast (FY)$17.79B
Asbury Business Overview & Revenue Model
Company Description
Asbury Automotive Group, Inc., together with its subsidiaries, operates as an automotive retailer in the United States. It operates through Dealerships; and Total Care Auto, Powered by Asbury (TCA) segments. The company offers a range of automotiv...
How the Company Makes Money
Asbury makes money primarily through multiple revenue and gross profit streams tied to dealership operations:
1) New vehicle sales: The company sells new vehicles through franchised dealerships. Revenue is recognized from the retail sale price of...
Asbury Earnings Call Summary
Earnings Call Date:Jul 28, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Oct 27, 2026
Earnings Call Sentiment Positive
The call presented a solid financial and operational foundation (healthy revenue, gross profit, adjusted EPS, liquidity and active buybacks) alongside clear early benefits from the Tekion rollout in mature markets and improving SG&A leverage. At the same time, the company is navigating short‑term headwinds from the DMS conversion (frictional costs and transitional sales impacts), lower same‑store volumes (new and used), OEM mix volatility, and temporarily higher leverage. Management provided a clear path to complete Tekion by October, expected SG&A improvement through 2027 and a plan to grow used vehicle volumes methodically, which together tilt the outlook positive if execution continues as planned.Positive Updates
Revenue, Profitability and EPS
Second quarter revenue of $4.4 billion, gross profit of $753 million (17.2% gross margin), adjusted operating margin of 5.3%, adjusted EBITDA of $235 million, adjusted net income of $125 million, and adjusted EPS of $6.82 (would have been $7.48 excluding a $0.66 per share TCA deferral headwind).
Negative Updates
Same‑Store New Vehicle Volume Decline
Same‑store new vehicle units declined 6%, with management attributing part of the decline to Tekion conversions (short‑term sales disruption during adaptation) and OEM mix pressures (notably Stellantis portfolio down 28% QoQ and some import EV rush effects).
Read all updates
Q2-2026 Updates
Positive
Negative
Revenue, Profitability and EPS
Second quarter revenue of $4.4 billion, gross profit of $753 million (17.2% gross margin), adjusted operating margin of 5.3%, adjusted EBITDA of $235 million, adjusted net income of $125 million, and adjusted EPS of $6.82 (would have been $7.48 excluding a $0.66 per share TCA deferral headwind).
Read all positive updates
Company Guidance
Management said the Tekion rollout is on track to be completed by October (70% of stores live, ~30% remaining, 13 stores converted in July) and that early Tekion markets are showing material productivity gains (June: average units per salesperson +12%, dollars per technician +10%; Koons Q/Q: units per sales manager +14.2%, units per F&I manager +15.2%), with SG&A expected to steadily decline each quarter (Q2 same‑store adjusted SG&A 65.3% of gross profit; all‑store 66%) and to reach the low‑60% range by the end of 2027 as savings begin in late 2026. Financial and operating targets reiterated include a normalized new‑vehicle PVR near $3.0k (Q2 same‑store $2.9k; all‑store $3.12k) with 53 days new day supply, used retail PVR $1.93k with 37 days used supply and planned volume growth into Q4 2026 while maintaining PVRs, F&I PVR $2.21k and total front‑end yield per vehicle $4.7k, customer‑pay fixed ops trending to low‑/mid‑single‑digit growth (June same‑store fixed gross +4%). Q2 results were $4.4B revenue, $753M gross profit (17.2% margin), adjusted operating margin 5.3%, adjusted net income $125M, adjusted EBITDA $235M, adjusted EPS $6.82 (would be $7.48 excluding a $0.66 TCA deferral), adjusted tax rate ~25% for the year, YTD adjusted operating cash flow $305M, adjusted free cash flow $188M through June, full‑year CapEx ~ $250M (H1 spend $117M), liquidity $966M, transaction‑adjusted net leverage 3.4x (target 3.0x early–mid‑2027), and continued share repurchases (Q2: 668k shares/$131M; YTD: 1.35M/$278M, ~7% of 2025 share count).Asbury Financial Statement Overview
Summary
Income Statement
58
Neutral
Balance Sheet
57
Neutral
Cash Flow
70
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 17.97B | 18.00B | 17.19B | 14.80B | 15.43B | 9.84B |
| Gross Profit | 3.08B | 3.07B | 2.95B | 2.76B | 3.10B | 1.90B |
| EBITDA | 1.07B | 1.02B | 919.30M | 1.03B | 1.55B | 841.70M |
| Net Income | 509.50M | 492.00M | 430.30M | 602.50M | 997.30M | 532.40M |
Balance Sheet | ||||||
| Total Assets | 11.41B | 11.77B | 10.34B | 10.16B | 8.02B | 8.00B |
| Cash, Cash Equivalents and Short-Term Investments | 35.70M | 40.90M | 83.80M | 51.90M | 240.70M | 189.90M |
| Total Debt | 5.53B | 6.33B | 5.28B | 5.48B | 3.69B | 4.56B |
| Total Liabilities | 7.49B | 7.88B | 6.83B | 6.92B | 5.12B | 5.89B |
| Stockholders Equity | 3.92B | 3.89B | 3.50B | 3.24B | 2.90B | 2.12B |
Cash Flow | ||||||
| Free Cash Flow | 670.60M | 569.90M | 363.00M | 170.70M | 588.10M | 1.08B |
| Operating Cash Flow | 1.03B | 775.20M | 671.20M | 313.00M | 696.00M | 1.16B |
| Investing Cash Flow | -1.09B | -1.46B | -137.20M | -1.68B | 464.70M | -3.92B |
| Financing Cash Flow | 13.30M | 653.10M | -510.30M | 1.18B | -1.10B | 2.93B |
Asbury Technical Analysis
Positive
225.24
Price Trends
207.12
Positive
201.73
Positive
217.13
Positive
Market Momentum
7.15
Positive
52.40
Neutral
26.06
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ABG, the sentiment is Positive. The current price of 225.24 is above the 20-day moving average (MA) of 222.30, above the 50-day MA of 207.12, and above the 200-day MA of 217.13, indicating a bullish trend. The MACD of 7.15 indicates Positive momentum. The RSI at 52.40 is Neutral, neither overbought nor oversold. The STOCH value of 26.06 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ABG.
Asbury Risk Analysis
Asbury disclosed 28 risk factors in its most recent earnings report. Asbury reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Asbury Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
69 Neutral | $7.11B | 9.80 | 33.18% | ― | -0.06% | 35.87% | |
66 Neutral | $8.47B | 12.72 | 7.00% | 0.65% | 1.97% | -10.60% | |
66 Neutral | $14.27B | 16.00 | 16.43% | 2.54% | 4.13% | -5.43% | |
65 Neutral | $4.31B | 8.65 | 13.04% | ― | 4.12% | -2.47% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
56 Neutral | $2.89B | 14.35 | 20.45% | 1.55% | 5.25% | 37.36% | |
52 Neutral | $3.42B | 11.92 | 9.96% | 0.63% | 0.81% | -33.60% |
* Consumer Cyclical Sector Average
ABG
Asbury
222.85
-6.53
-2.85%
AN
AutoNation
215.60
20.09
10.28%
GPI
Group 1 Automotive
285.88
-134.87
-32.05%
LAD
Lithia Motors
370.99
76.38
25.92%
PAG
Penske Automotive Group
219.05
45.24
26.03%
SAH
Sonic Automotive
88.27
15.47
21.25%
Asbury Corporate Events
Executive/Board ChangesShareholder Meetings
Asbury Shareholders Back Board, Governance Changes at Meeting
Positive
May 6, 2026
At Asbury’s 2026 Annual Meeting of Stockholders held on May 4, 2026, shareholders elected all eleven director nominees to serve until the next annual meeting and approved an advisory resolution on the compensation of the company’s name...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.