Share price of AutoNation Inc. AN decreased a marginal 0.4% to $62.04 on Mar 4 due to decline in the broader market, despite an 8% year-over-year increase in sales to 23,780 vehicles in Feb 2015. The growth was attributable to strong sales recorded at all segments, with the Premium Luxury segment witnessing the maximum rise. On a same-store basis, retail new vehicle sales went up 7%.
Sales in the Domestic segment rose 7% to 7,331 vehicles in February. This segment comprises retail automotive franchises that sell vehicles manufactured by Ford Motor Co. F, Chrysler and others.
Sales in the Import segment increased 5% to 11,339 vehicles. This segment covers retail automotive franchises that sell vehicles manufactured by Toyota Motor Corp. TM, Honda Motor Co., Ltd. HMC and others.
Sales in the Premium Luxury segment escalated 18% to 5,110 vehicles during the month. This segment consists of retail automotive franchises that sell vehicles manufactured by Mercedes Benz, BMW, Lexus and others.
Earnings Review
AutoNation posted a 22.9% rise in earnings per share to $1.02 in the fourth quarter of 2014 from 83 cents in the year-ago comparable quarter. Earnings per share also surpassed the Zacks Consensus Estimate of 92 cents.
Revenues increased 11.6% to $5.05 billion in the reported quarter, beating the Zacks Consensus Estimate of $4.9 billion. The uptrend can be attributed to strong performance at all the business sectors, including new vehicles, parts and service, used vehicles, and finance and insurance. The company’s Premium Luxury segment gained the maximum in the quarter.
AutoNation expects to benefit from improved new vehicle unit sales. In 2015, industry new vehicle sales are expected to be above 17 million units.
Based in Fort Lauderdale, FL, AutoNation is the largest automotive retailer in the U.S. The company owns and operates about 282 new vehicle franchises that sell 34 brands in major metropolitan markets across 15 states. AutoNation currently carries a Zacks Rank #2 (Buy).
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