Sonic Automotive (NYSE:SAH) Announces Quarterly Earnings Results, Beats Expectations By $0.56 EPS

Key Points

• Sonic Automotive reported a quarterly EPS of $2.19, exceeding estimates by $0.56, while its revenue was $3.66 billion, reflecting a 5.9% increase year-over-year.
• The company announced an increased quarterly dividend of $0.38, with a yield of 1.93%, scheduled for payment on October 15th.
• Goldman Sachs and Needham & Company both raised their price targets for Sonic Automotive, with the new targets set at $94.00 and $95.00, respectively, reflecting growing analyst confidence in the stock.

Sonic Automotive (NYSE:SAH - Get Free Report) posted its earnings results on Thursday. The company reported $2.19 EPS for the quarter, topping the consensus estimate of $1.63 by $0.56, Zacks reports. Sonic Automotive had a return on equity of 21.27% and a net margin of 1.07%. The firm had revenue of $3.66 billion for the quarter, compared to analyst estimates of $3.66 billion. During the same period last year, the company earned $1.47 earnings per share. Sonic Automotive's revenue for the quarter was up 5.9% compared to the same quarter last year.

Sonic Automotive Trading Up 4.6%

NYSE:SAH traded up $3.47 on Friday, reaching $78.90. The company's stock had a trading volume of 351,086 shares, compared to its average volume of 233,692. Sonic Automotive has a 12-month low of $52.00 and a 12-month high of $89.62. The company has a quick ratio of 0.38, a current ratio of 1.09 and a debt-to-equity ratio of 1.67. The firm has a market cap of $2.68 billion, a price-to-earnings ratio of 17.53 and a beta of 1.04. The stock has a 50 day moving average price of $77.46 and a 200 day moving average price of $69.46.

Sonic Automotive Increases Dividend

The firm also recently announced a quarterly dividend, which will be paid on Wednesday, October 15th. Shareholders of record on Monday, September 15th will be given a $0.38 dividend. The ex-dividend date of this dividend is Monday, September 15th. This represents a $1.52 dividend on an annualized basis and a yield of 1.93%. This is an increase from Sonic Automotive's previous quarterly dividend of $0.35. Sonic Automotive's payout ratio is currently 19.94%.

Insider Buying and Selling

In related news, President Jeff Dyke sold 576 shares of the business's stock in a transaction on Monday, June 2nd. The stock was sold at an average price of $70.02, for a total value of $40,331.52. Following the sale, the president owned 605,393 shares in the company, valued at approximately $42,389,617.86. The trade was a 0.10% decrease in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through this hyperlink. Insiders sold a total of 50,000 shares of company stock valued at $3,502,062 in the last quarter. 42.65% of the stock is owned by insiders.

Institutional Investors Weigh In On Sonic Automotive

Several institutional investors and hedge funds have recently modified their holdings of SAH. Goldman Sachs Group Inc. raised its holdings in shares of Sonic Automotive by 124.9% in the 1st quarter. Goldman Sachs Group Inc. now owns 355,328 shares of the company's stock valued at $20,239,000 after buying an additional 197,336 shares during the period. Jane Street Group LLC raised its holdings in shares of Sonic Automotive by 263.4% in the 1st quarter. Jane Street Group LLC now owns 62,908 shares of the company's stock valued at $3,583,000 after buying an additional 45,596 shares during the period. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC raised its holdings in shares of Sonic Automotive by 15.8% in the 1st quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC now owns 38,698 shares of the company's stock valued at $2,204,000 after buying an additional 5,286 shares during the period. Royal Bank of Canada raised its holdings in shares of Sonic Automotive by 37.1% in the 1st quarter. Royal Bank of Canada now owns 13,946 shares of the company's stock valued at $795,000 after buying an additional 3,777 shares during the period. Finally, AQR Capital Management LLC raised its holdings in shares of Sonic Automotive by 13.6% in the 1st quarter. AQR Capital Management LLC now owns 23,310 shares of the company's stock valued at $1,328,000 after buying an additional 2,793 shares during the period. Hedge funds and other institutional investors own 46.92% of the company's stock.

Analysts Set New Price Targets

Several analysts have commented on the company. Bank of America raised their price objective on Sonic Automotive from $80.00 to $94.00 and gave the company a "buy" rating in a report on Monday, June 16th. Needham & Company LLC raised their price objective on Sonic Automotive from $74.00 to $95.00 and gave the company a "buy" rating in a report on Friday. Wall Street Zen lowered Sonic Automotive from a "strong-buy" rating to a "buy" rating in a research note on Saturday, June 21st. Citigroup initiated coverage on Sonic Automotive in a research note on Wednesday, April 23rd. They issued a "neutral" rating and a $64.00 price target on the stock. Finally, JPMorgan Chase & Co. reaffirmed an "underweight" rating and issued a $72.00 price target (up from $65.00) on shares of Sonic Automotive in a research note on Thursday, July 17th. One research analyst has rated the stock with a sell rating, three have assigned a hold rating, four have assigned a buy rating and one has assigned a strong buy rating to the company. Based on data from MarketBeat.com, the stock currently has a consensus rating of "Moderate Buy" and an average price target of $77.86.

Sonic Automotive Company Profile

Sonic Automotive, Inc operates as an automotive retailer in the United States. It operates in three segments, Franchised Dealerships, EchoPark, and Powersports. 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.

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