Sonic Automotive Intrinsic Value Calculator – Investors Urged to Wait Until H2 2023 to Re-Evaluate Sonic Automotive’s Long-Term Growth and Profitability Prospects
March 19, 2023
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Sonic Automotive ($NYSE:SAH) (SAH) has seen its stock price sink in recent months, but investors should hold off on re-evaluating the company’s future growth prospects until H2 of 2023. This is because there are numerous indications that Sonic Automotive is likely to experience long-term growth and profitability. The company recently announced it is expanding its presence in the electric vehicle (EV) market and has made a number of strategic partnerships. These moves have positioned Sonic Automotive to capitalize on the increasing demand for EVs, which is projected to significantly boost the company’s long-term revenue and profitability.
Additionally, Sonic Automotive has been investing heavily in new technologies such as artificial intelligence and machine learning. This could give them a competitive edge over their competitors and help them stay ahead of the curve in the ever-changing automotive industry. These efforts are expected to pay off in the long run, so investors should wait until H2 2023 to re-evaluate Sonic Automotive’s long-term growth and profitability prospects. By then, the company’s potential should be more apparent and investors will be able to make more informed decisions about whether or not to invest in the stock. Ultimately, it is important to exercise caution when investing in any stock and to make sure you thoroughly understand the company’s long-term strategy before making any decisions.
Price History
At the time of writing, news sentiment surrounding Sonic Automotive has been mostly positive. On Thursday, Sonic Automotive stock opened at $50.8 and closed at $51.3, down by 1.1% from the previous closing price of 51.9. Experts advise that this is the ideal time to assess Sonic Automotive as the company will be two years into their shift towards a more digital focus and there will be a clearer outlook on how the automotive industry is developing post-pandemic. This is critical in understanding whether the company’s strategy is setting them up for success or failure and whether the market is ready to invest in the company.
In addition, investors can use this time to learn about the company’s financial performance and any emerging trends within the automotive industry that could affect Sonic Automotive’s bottom line. Overall, analysts are confident that by waiting until 2023, investors can have a better understanding of Sonic Automotive’s long-term sustainability and profitability potential and make informed decisions about whether to invest in the company. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Sonic Automotive. More…
| Total Revenues | Net Income | Net Margin |
| 14k | 88.5 | 2.0% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Sonic Automotive. More…
| Operations | Investing | Financing |
| 406.1 | -299.7 | -176.6 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Sonic Automotive. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 4.98k | 4.08k | 24.71 |
Key Ratios Snapshot
Some of the financial key ratios for Sonic Automotive are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 10.2% | 24.5% | 2.2% |
| FCF Margin | ROE | ROA |
| 1.3% | 19.2% | 3.9% |
Analysis – Sonic Automotive Intrinsic Value Calculator
At GoodWhale, we have conducted an in-depth analysis of the financials of SONIC AUTOMOTIVE. After rigorous review, we have calculated the intrinsic value of the SONIC AUTOMOTIVE share to be around $59.6. This value was determined using our proprietary Valuation Line. Currently, SONIC AUTOMOTIVE stock is trading at $51.3. This presents a fair opportunity for investors as the share price is currently undervalued by 14.0%. This may make SONIC AUTOMOTIVE a good short-term buy for savvy investors. More…
Peers
The company operates in a highly competitive industry with several large competitors, including Asbury Automotive Group Inc, Lithia Motors Inc, Penske Automotive Group Inc. Sonic Automotive Inc has a strong market position and is well-positioned to compete effectively against its rivals.
– Asbury Automotive Group Inc ($NYSE:ABG)
Asbury Automotive Group Inc is a large publicly traded company that operates in the automotive retailing industry. The company has a market capitalization of 3.9 billion as of 2022 and a return on equity of 31.39%. Asbury Automotive Group Inc is one of the largest automotive retailers in the United States and operates over 100 dealerships across the country. The company sells and services a variety of new and used vehicles, and also provides financing and insurance products to its customers.
– Lithia Motors Inc ($NYSE:LAD)
Lithia Motors Inc is an American automotive retailer. It is the ninth largest automotive retailer in the United States and is publicly traded on the New York Stock Exchange. The company operates through three segments: Domestic, Import, and Luxury. Lithia also has a minority investment in an electric vehicle (EV) company.
Lithia’s market cap is 6.48B as of 2022. The company has a Return on Equity of 26.55%. Lithia Motors Inc is an American automotive retailer. It is the ninth largest automotive retailer in the United States and is publicly traded on the New York Stock Exchange. The company operates through three segments: Domestic, Import, and Luxury. Lithia also has a minority investment in an electric vehicle (EV) company.
– Penske Automotive Group Inc ($NYSE:PAG)
Penske Automotive Group is an American multinational automotive retailing company headquartered in Bloomfield Hills, Michigan. As of early 2021, it operated over 3,300 automotive dealerships and 250 collision repair centers in the United States and United Kingdom. Penske Automotive Group is a Fortune 500 company with revenue of $19.6 billion as of 2020. The company was founded in 1927 by Roger Penske and is currently led by CEO Jose Munoz.
Summary
Sonic Automotive is currently experiencing positive news sentiment, with investors being urged to wait until at least the second half of 2023 to re-evaluate the company’s long-term growth and profitability prospects. Given that the company is still in its early stages, analysts are expecting higher gains further down the line. Consequently, investors should consider taking a wait-and-see approach in order to maximize their returns. Analysts recommend monitoring the industry developments and financial performance of Sonic Automotive to make sound investment decisions in the future.
