Sonic Automotive (SAH) AI Stock Analysis

• Market Cap: $2.69B
• Dividend Yield: 1.71%
• Average Volume (3M): 224.52K
• Price to Earnings (P/E): 17.5
• Beta (1Y): 1.00
• Revenue Growth: 4.48%
• EPS Growth: -16.26%
• Country: US
• Employees: 10,800
• Sector: Consumer Cyclical
• Sector Strength: 64
• Industry: Auto - Dealerships
• EPS (TTM): 2.19
• Shares Outstanding: 22,120,758
• 10 Day Avg. Volume: 284,757
• 30 Day Avg. Volume: 224,517
• PEG Ratio: 0.92
• Price to Book (P/B): 2.76
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 96.00
• Enterprise Value/Market Cap: 2.60
• Enterprise Value/Revenue: 0.12
• Enterprise Value/Gross Profit: 3.20
• Enterprise Value/Ebitda: 2.88
• 1Y Price Target: $83.14
• Price Target Upside: 5.49% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 7

• Rating: 67 Neutral
• Price Target: $82.00 ▲(4.05%Upside)

Sonic Automotive's overall stock score reflects solid revenue growth and improved cash flow management, which are vital strengths. However, high leverage and declining profit margins are significant risks. The technical indicators suggest potential short-term weakness, but the earnings call provided a generally positive outlook with record performances in several segments. The valuation is reasonable but not exceptionally appealing.

Positive Factors

Earnings

EchoPark posted its second consecutive quarter of record segment income and EBITDA, with strong margin performance.

Market Position

SAH is the smallest of the six public auto dealers, benefiting from a resilient premium-luxury franchised business and strong exposure to key markets in Texas and California.

Strategic Expansion

Strategic expansion continues with the acquisition of four Jaguar Land Rover stores in California, establishing Sonic as the largest JLR retailer in the U.S.

Negative Factors

Shipment Delays

JLR halted shipments at the time of the Tariff announcements.

Valuation

SAH continues to generate strong results, yet trades at lower multiples than peers.

Sonic Automotive Business Overview & Revenue Model

Company Description

Sonic Automotive, Inc. operates as an automotive retailer in the United States. It operates in two segments, Franchised Dealerships and EchoPark. The Franchised Dealerships segment is involved in the sale of new and used cars and light trucks, and replacement parts; provision of vehicle maintenance, manufacturer warranty repair, and paint and collision repair services; and arrangement of extended warranties, service contracts, financing, insurance, and other aftermarket products for its guests. The EchoPark segment sells used cars and light trucks; and arranges finance and insurance product sales for its guests in pre-owned vehicle specialty retail locations. As of December 31, 2021, the company operated 140 new vehicle franchises representing 28 brands of cars and light trucks; 17 collision repair centers in 17 states; and 46 EchoPark stores in 16 states, including 11 Northwest Motorsport pre-owned vehicle stores. Sonic Automotive, Inc. was incorporated in 1997 and is based in Charlotte, North Carolina.

How the Company Makes Money

Sonic Automotive generates revenue through several key streams. The primary source of income comes from the sale of new and used vehicles at its franchised dealerships and EchoPark locations. Additionally, the company earns money by selling vehicle parts and accessories and providing maintenance and repair services. Financing and insurance products offered to customers also contribute to its revenue, as Sonic Automotive partners with financial institutions to offer competitive loan and lease options. Furthermore, the company benefits from manufacturer incentives and volume-based bonuses, which help bolster its income. EchoPark, which focuses on pre-owned vehicles, is a significant growth driver for the company, contributing to both sales volume and profitability.

Sonic Automotive Financial Statement Overview

Summary

Sonic Automotive demonstrates robust revenue growth and improved cash flow management, which are positive indicators for the company's financial health. However, high leverage and declining profit margins present potential risks. Continued focus on operational efficiency and debt management will be crucial to sustain its growth trajectory and financial stability.

Income Statement

Sonic Automotive shows strong revenue growth, with a notable increase of approximately 48% from 2020 to 2025. The gross profit margin remains stable, indicating efficient cost management despite fluctuations. However, the net profit margin and EBIT margin have decreased over the years, suggesting potential challenges in managing operational expenses or changes in market conditions.

Balance Sheet

The company's debt-to-equity ratio indicates high leverage, which could pose risks if market conditions worsen. There is a positive trend in stockholders' equity, but the equity ratio remains relatively low, reflecting a high reliance on debt financing. Return on equity has improved, demonstrating more effective use of equity capital in generating profits.

Cash Flow

Sonic Automotive has shown significant improvement in free cash flow from 2024 to 2025, moving from negative to positive, indicating better cash management. The operating cash flow to net income ratio is strong, suggesting effective cash conversion. However, the free cash flow to net income ratio tends to fluctuate, which could impact long-term financial stability.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	14.49B	14.22B	14.37B	14.00B	12.40B	9.77B
Gross Profit	2.19B	2.19B	2.25B	2.32B	1.91B	1.42B
EBITDA	649.70M	605.10M	558.60M	441.00M	622.50M	125.40M
Net Income	244.60M	216.00M	178.20M	88.50M	348.90M	-50.66M
Balance Sheet
Total Assets	5.88B	5.90B	5.36B	4.98B	4.98B	3.75B
Cash, Cash Equivalents and Short-Term Investments	64.60M	44.00M	28.90M	229.20M	299.40M	170.31M
Total Debt	4.05B	4.13B	3.86B	3.49B	3.32B	2.45B
Total Liabilities	4.78B	4.83B	4.47B	4.08B	3.90B	2.93B
Stockholders Equity	1.09B	1.06B	891.90M	895.20M	1.08B	814.80M
Cash Flow
Free Cash Flow	31.40M	-78.10M	-219.30M	179.00M	8.10M	153.90M
Operating Cash Flow	219.90M	109.20M	-15.70M	406.10M	306.30M	281.08M
Investing Cash Flow	-174.40M	-178.30M	-218.70M	-299.70M	-1.30B	-100.18M
Financing Cash Flow	-300.00K	84.30M	34.10M	-176.60M	624.80M	-39.69M

Sonic Automotive Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 78.81
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SAH, the sentiment is Positive. The current price of 78.81 is below the 20-day moving average (MA) of 82.74, above the 50-day MA of 76.79, and above the 200-day MA of 66.67, indicating a neutral trend. The MACD of 0.04 indicates Positive momentum. The RSI at 47.79 is Neutral, neither overbought nor oversold. The STOCH value of 18.71 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SAH.

Sonic Automotive 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%	2.71%	3.29%	-1.29%
GPI	75 Outperform	$5.65B	12.09	15.72%	0.44%	19.75%	-10.74%
ABG	74 Outperform	$4.67B	11.31	11.92%	―	11.11%	-23.41%
AN	71 Outperform	$7.66B	12.73	27.24%	―	3.15%	-12.49%
SAH	67 Neutral	$2.69B	17.54	15.99%	1.71%	4.48%	-16.26%
LAD	67 Neutral	$8.15B	9.86	12.95%	0.68%	12.96%	-6.25%
Sector *	61 Neutral	€6.07B	10.66	-11.12%	4.08%	3.99%	-37.65%

Sonic Automotive Corporate Events

Sonic Automotive Reports Q2 Revenue Growth Despite Loss

On July 24, 2025, Sonic Automotive reported its second-quarter financial results, highlighting a record total revenue of $3.7 billion, a 6% increase year-over-year, despite a net loss of $45.6 million due to a franchise asset impairment charge. The company achieved significant growth in its EchoPark Segment with record income and adjusted EBITDA, and completed the acquisition of four Jaguar Land Rover dealerships, becoming the largest retailer of these brands in the U.S. Sonic’s board also approved a 9% increase in the quarterly cash dividend, reflecting confidence in the company’s strategic direction and financial health.

The most recent analyst rating on (SAH) stock is a Buy with a $66.00 price target. To see the full list of analyst forecasts on Sonic Automotive stock, see the SAH Stock Forecast page.