AutoNation (AN) AI Stock Analysis

• Market Cap: $7.66B
• Dividend Yield: N/A
• Average Volume (3M): 471.28K
• Price to Earnings (P/E): 12.7
• Beta (1Y): 0.98
• Revenue Growth: 3.15%
• EPS Growth: -12.49%
• Country: US
• Employees: 25,100
• Sector: Consumer Cyclical
• Sector Strength: 64
• Industry: Auto - Dealerships
• EPS (TTM): 5.46
• Shares Outstanding: 37,701,138
• 10 Day Avg. Volume: 603,362
• 30 Day Avg. Volume: 471,277
• PEG Ratio: -2.15
• Price to Book (P/B): 3.30
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -16.99
• Enterprise Value/Market Cap: 2.17
• Enterprise Value/Revenue: 0.20
• Enterprise Value/Gross Profit: 5.14
• Enterprise Value/Ebitda: 4.14
• 1Y Price Target: $222.14
• Price Target Upside: 13.19% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 7

• Rating: 69 Neutral
• Price Target: $215.00 ▲(9.55%Upside)

AutoNation's stable revenue and strong earnings growth are overshadowed by financial risks due to high leverage and negative cash flow. The recent securitization transaction and positive earnings call provide some optimism but are balanced by challenging technical indicators and modest valuation.

Positive Factors

Electric Vehicle Sales

Battery Electric Vehicle sales were up nearly 50% from a year ago, reflecting strong demand and manufacturer incentives.

Revenue Growth

AutoNation reported a revenue increase of 3% year-over-year to $6.7 billion, surpassing consensus expectations.

Share Buybacks

Capital allocation focus remains on share buybacks, with significant spending on share repurchases.

Negative Factors

Gross Profit Margins

Gross profit margins decreased by 30 basis points year-over-year to 18.2%.

Operating Margins

Operating margins were softer, decreasing from the previous year.

SG&A Expenses

SG&A as a percentage of gross profit increased to 67.5% from 65.6% compared to the previous year.

AutoNation Business Overview & Revenue Model

Company Description

AutoNation, Inc., through its subsidiaries, operates as an automotive retailer in the United States. The company operates through three segments: Domestic, Import, and Premium Luxury. It offers a range of automotive products and services, including new and used vehicles; and parts and services, such as automotive repair and maintenance, and wholesale parts and collision services. The company also provides automotive finance and insurance products comprising vehicle services and other protection products, as well as arranges finance for vehicle purchases through third-party finance sources. As of December 31, 2021, it owned and operated 339 new vehicle franchises from 247 stores located primarily in metropolitan markets in the Sunbelt region. The company also owned and operated 57 AutoNation-branded collision centers, 9 AutoNation USA used vehicle stores, 4 AutoNation-branded automotive auction operations, and 3 parts distribution centers. AutoNation, Inc. was founded in 1991 and is headquartered in Fort Lauderdale, Florida.

How the Company Makes Money

AutoNation makes money primarily through the sale of new and used vehicles, which is the largest component of its revenue. The company also generates significant income from its after-sales services, including vehicle maintenance and repairs, which provide a steady stream of recurring revenue. Additionally, AutoNation earns money through finance and insurance products, such as arranging vehicle financing, selling extended service contracts, and offering other related products. These finance and insurance activities contribute substantially to the company's profitability. AutoNation's extensive network of dealerships and strategic partnerships with automotive manufacturers enhance its ability to attract a broad customer base and drive sales across its various revenue streams.

AutoNation Financial Statement Overview

Summary

AutoNation's financial performance shows stable revenue with consistent gross profitability, but challenges in net margins and cash management. High leverage is a concern, impacting financial stability.

Income Statement

AutoNation's income statement shows a stable revenue base with a slight growth in the TTM period. Gross Profit Margin stands at 17.83% for TTM, showing consistent profitability. However, there is a decline in Net Profit Margin from 3.88% in 2024 to 2.51% in TTM, indicating rising costs or expenses. The EBIT and EBITDA margins are stable, but lower compared to earlier years, reflecting operational efficiency challenges.

Balance Sheet

The balance sheet reveals a relatively high Debt-to-Equity Ratio, increasing from 3.52 in 2024 to 9.86 in TTM, highlighting significant leverage. The company maintains a moderate Equity Ratio of 18.03% in TTM, suggesting a dependence on debt financing. With a declining Return on Equity from 28.17% in 2024 to 28.19% in TTM, profitability on shareholder equity shows slight improvement but may be strained by high leverage.

Cash Flow

Cash flow analysis shows a concerning decline in Free Cash Flow, turning negative in TTM, which could affect liquidity and operational flexibility. The Operating Cash Flow to Net Income Ratio reduced significantly, indicating challenges in converting income into cash. Free Cash Flow to Net Income Ratio is negative, signaling potential cash management issues.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	26.77B	26.95B	26.98B	25.84B	20.39B
Gross Profit	4.79B	5.13B	5.27B	4.95B	3.57B
EBITDA	1.60B	1.87B	2.21B	2.09B	842.70M
Net Income	692.20M	1.02B	1.38B	1.37B	381.60M
Balance Sheet
Total Assets	13.00B	11.98B	10.06B	8.94B	9.89B
Cash, Cash Equivalents and Short-Term Investments	59.80M	60.80M	72.60M	60.40M	569.60M
Total Debt	8.65B	8.03B	6.42B	4.95B	5.19B
Total Liabilities	10.54B	9.77B	8.01B	6.57B	6.65B
Stockholders Equity	2.46B	2.21B	2.05B	2.38B	3.24B
Cash Flow
Free Cash Flow	-13.80M	313.70M	1.34B	1.41B	1.05B
Operating Cash Flow	314.70M	724.00M	1.67B	1.63B	1.21B
Investing Cash Flow	12.30M	-569.90M	-479.30M	-460.30M	-73.70M
Financing Cash Flow	-300.60M	-172.50M	-1.15B	-1.68B	-606.70M

AutoNation Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 196.26
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AN, the sentiment is Neutral. The current price of 196.26 is below the 20-day moving average (MA) of 205.62, above the 50-day MA of 196.02, and above the 200-day MA of 178.81, indicating a neutral trend. The MACD of 0.81 indicates Positive momentum. The RSI at 44.12 is Neutral, neither overbought nor oversold. The STOCH value of 26.19 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for AN.

AutoNation Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PAG	76 Outperform	$11.58B	12.34	18.57%	2.78%	3.29%	-1.29%
GPI	75 Outperform	$5.65B	12.09	15.72%	0.44%	19.75%	-10.74%
ABG	74 Outperform	$4.51B	10.91	11.92%	―	11.11%	-23.41%
AN	69 Neutral	$7.66B	12.73	27.24%	―	3.15%	-12.49%
LAD	67 Neutral	$7.99B	9.67	12.95%	0.70%	12.96%	-6.25%
SAH	67 Neutral	$2.69B	17.54	15.99%	1.77%	4.48%	-16.26%
Sector *	65 Neutral	€20.20B	10.13	7.83%	3.17%	0.85%	-38.46%

AutoNation Corporate Events

AutoNation Completes $700 Million Securitization Transaction

On May 21, 2025, AutoNation announced the completion of a $700 million asset-backed securitization transaction through its captive finance company, AutoNation Finance. This inaugural transaction involved the issuance of seven classes of notes with a weighted-average interest rate of 4.90%, secured by $714.3 million of automobile loan contracts. The net proceeds of approximately $696.4 million will be used to reduce existing debt and support corporate purposes. The transaction was well-received, allowing AutoNation to secure a competitive interest rate and increase the offering size by $200 million, enhancing its capital allocation flexibility.

The most recent analyst rating on (AN) stock is a Buy with a $215.00 price target. To see the full list of analyst forecasts on AutoNation stock, see the AN Stock Forecast page.