AutoNation (NYSE:AN) Shares Down 4% – What’s Next?

AutoNation, Inc. (NYSE:AN)’s stock price fell 4% on Thursday . The company traded as low as $193.81 and last traded at $187.6440. Approximately 155,438 shares were traded during mid-day trading, a decline of 63% from the average daily volume of 418,086 shares. The stock had previously closed at $195.37.

More AutoNation News

Here are the key news stories impacting AutoNation this week:

• Positive Sentiment: Several analysts’ price targets remain materially above the current trading level, with a reported median target of $244.50. Institutional activity was mixed, but some large funds—including AQR Capital Management, D. E. Shaw and Sixth Street Partners—added shares during the second quarter. AutoNation Stock Forecast and Price Target
• Neutral Sentiment: AutoNation continues to benefit from comparatively stronger after-sales and finance operations, but recent operating data showed retail used-vehicle sales down 8.0% year over year and total retail unit sales down 6.4%, indicating uneven demand across the business. AutoNation Morgan Stanley Conference Transcript
• Negative Sentiment: Management expects third-quarter gross profit per vehicle to decline approximately 10% sequentially, partly because of model-year changeovers. Investors interpreted the forecast as a warning of near-term earnings and margin pressure. AutoNation Cautious Conference Commentary
• Negative Sentiment: Service growth has softened, new-vehicle margins are expected to weaken and consumer affordability remains a headwind. These factors could limit revenue growth and profitability in the near term. AutoNation Service Growth and Affordability
• Negative Sentiment: Demand for electric vehicles has weakened following the expiration of federal incentives, adding pressure to the outlook. Recent insider activity also showed sales rather than purchases, though those transactions are a secondary factor compared with the operating warning. AutoNation Warning Ahead of Third-Quarter Earnings

Analyst Upgrades and Downgrades

A number of research analysts recently issued reports on the stock. Stephens boosted their price objective on shares of AutoNation from $220.00 to $232.00 and gave the company an “equal weight” rating in a report on Monday, August 10th. Argus lifted their price target on shares of AutoNation from $241.00 to $246.00 and gave the stock a “buy” rating in a research report on Tuesday, August 11th. Weiss Ratings lowered shares of AutoNation from a “buy (b)” rating to a “buy (b-)” rating in a report on Thursday, September 3rd. Seaport Research Partners reissued a “buy” rating and issued a $255.00 price target on shares of AutoNation in a report on Monday, August 3rd. Finally, Wells Fargo & Company upped their price objective on shares of AutoNation from $202.00 to $224.00 and gave the company an “equal weight” rating in a research report on Monday, August 3rd. Ten investment analysts have rated the stock with a Buy rating and two have issued a Hold rating to the company. Based on data from MarketBeat, the stock currently has an average rating of “Moderate Buy” and a consensus target price of $250.00.

AutoNation Price Performance

The company has a debt-to-equity ratio of 2.68, a quick ratio of 0.18 and a current ratio of 0.78. The company has a 50-day moving average of $204.71 and a 200-day moving average of $197.36. The firm has a market capitalization of $5.56 billion, a price-to-earnings ratio of 7.80, a price-to-earnings-growth ratio of 0.85 and a beta of 0.72.

AutoNation (NYSE:AN) last announced its earnings results on Friday, July 31st. The company reported $5.56 EPS for the quarter, topping the consensus estimate of $5.48 by $0.08. AutoNation had a net margin of 2.82% and a return on equity of 31.24%. The firm had revenue of $6.93 billion for the quarter, compared to the consensus estimate of $7 billion. During the same period last year, the company posted $2.26 EPS. The business’s quarterly revenue was down .6% on a year-over-year basis. As a group, research analysts anticipate that AutoNation, Inc. will post 21.69 EPS for the current fiscal year.

Insider Activity at AutoNation

In related news, Director Lisa Lutoff-Perlo sold 900 shares of the firm’s stock in a transaction on Wednesday, August 5th. The shares were sold at an average price of $220.00, for a total transaction of $198,000.00. Following the sale, the director directly owned 7,989 shares in the company, valued at $1,757,580. This trade represents a 10.12% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the SEC, which is available at this hyperlink. 1.40% of the stock is currently owned by insiders.

Institutional Trading of AutoNation

Several hedge funds and other institutional investors have recently modified their holdings of the company. Redwood Investment Management LLC grew its holdings in shares of AutoNation by 1.1% during the first quarter. Redwood Investment Management LLC now owns 5,372 shares of the company’s stock worth $1,049,000 after buying an additional 61 shares in the last quarter. Mitchell Sinkler & Starr PA boosted its position in AutoNation by 3.6% during the 4th quarter. Mitchell Sinkler & Starr PA now owns 2,183 shares of the company’s stock worth $451,000 after acquiring an additional 75 shares during the last quarter. Bessemer Group Inc. grew its stake in shares of AutoNation by 33.0% during the 1st quarter. Bessemer Group Inc. now owns 306 shares of the company’s stock worth $59,000 after acquiring an additional 76 shares in the last quarter. Parkside Financial Bank & Trust raised its holdings in shares of AutoNation by 73.9% in the second quarter. Parkside Financial Bank & Trust now owns 193 shares of the company’s stock valued at $36,000 after purchasing an additional 82 shares during the last quarter. Finally, IFP Advisors Inc lifted its position in shares of AutoNation by 20.4% in the fourth quarter. IFP Advisors Inc now owns 566 shares of the company’s stock worth $117,000 after purchasing an additional 96 shares in the last quarter. Institutional investors and hedge funds own 94.62% of the company’s stock.

AutoNation Company Profile

AutoNation, Inc is a leading automotive retailer in the United States. The company sells new and used vehicles through a network of franchised dealerships and provides automotive services including vehicle financing, insurance products, maintenance, repair, parts, and collision-repair services.

In addition to its manufacturer-branded dealerships, AutoNation operates AutoNation USA locations focused primarily on used vehicles and offers digital tools that allow customers to research, purchase, finance, and service vehicles online.