Sonic Automotive (NYSE:SAH) Stock Price Expected to Rise, Morgan Stanley Analyst Says

Key Points

• Morgan Stanley raised the price target for Sonic Automotive from $60.00 to $72.00, indicating a potential downside of 9.75% from its current price.
• Sonic Automotive recently reported earnings of $2.19 per share, surpassing analysts' expectations of $1.63.
• Various analysts have issued mixed ratings on Sonic Automotive, with a current consensus rating of "Moderate Buy" and an average price target of $79.86.

Sonic Automotive (NYSE:SAH - Free Report) had its price objective raised by Morgan Stanley from $60.00 to $72.00 in a research note issued to investors on Thursday,Benzinga reports. The firm currently has an equal weight rating on the stock.

Several other equities analysts have also recently issued reports on SAH. JPMorgan Chase & Co. reissued an "underweight" rating and set a $72.00 target price (up from $65.00) on shares of Sonic Automotive in a research note on Thursday, July 17th. Bank of America lifted their price target on Sonic Automotive from $80.00 to $94.00 and gave the company a "buy" rating in a research report on Monday, June 16th. Stephens downgraded Sonic Automotive from an "overweight" rating to an "equal weight" rating and boosted their target price for the stock from $72.00 to $82.00 in a report on Thursday, July 17th. Wall Street Zen cut Sonic Automotive from a "strong-buy" rating to a "buy" rating in a research note on Saturday, June 21st. Finally, Needham & Company LLC restated a "buy" rating and issued a $95.00 price target on shares of Sonic Automotive in a research note on Wednesday, August 6th. One investment analyst has rated the stock with a Strong Buy rating, three have given a Buy rating, three have assigned a Hold rating and one has assigned a Sell rating to the stock. According to MarketBeat, the company has a consensus rating of "Moderate Buy" and an average price target of $79.86.

Sonic Automotive Trading Up 1.8%

SAH traded up $1.3950 during trading on Thursday, hitting $79.7350. The company's stock had a trading volume of 112,152 shares, compared to its average volume of 274,005. The company has a quick ratio of 0.24, a current ratio of 1.03 and a debt-to-equity ratio of 1.78. Sonic Automotive has a twelve month low of $52.00 and a twelve month high of $89.62. The stock's fifty day moving average price is $79.27 and its 200-day moving average price is $70.20. The firm has a market capitalization of $2.72 billion, a P/E ratio of 17.72 and a beta of 0.99.

Sonic Automotive (NYSE:SAH - Get Free Report) last announced its quarterly earnings results on Thursday, July 24th. The company reported $2.19 earnings per share (EPS) for the quarter, topping the consensus estimate of $1.63 by $0.56. Sonic Automotive had a return on equity of 21.40% and a net margin of 1.07%.The business had revenue of $3.66 billion during the quarter, compared to the consensus estimate of $3.66 billion. During the same quarter in the prior year, the company posted $1.47 earnings per share. Sonic Automotive's revenue was up 5.9% compared to the same quarter last year. Analysts anticipate that Sonic Automotive will post 6.14 EPS for the current year.

Sonic Automotive Increases Dividend

The company also recently disclosed a quarterly dividend, which will be paid on Wednesday, October 15th. Shareholders of record on Monday, September 15th will be issued a dividend of $0.38 per share. This represents a $1.52 annualized dividend and a yield of 1.9%. The ex-dividend date is Monday, September 15th. This is an increase from Sonic Automotive's previous quarterly dividend of $0.35. Sonic Automotive's dividend payout ratio (DPR) is 31.11%.

Insider Transactions at Sonic Automotive

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

Hedge Funds Weigh In On Sonic Automotive

A number of institutional investors have recently modified their holdings of the stock. Goldman Sachs Group Inc. increased its stake 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 purchasing an additional 197,336 shares in the last quarter. Westwood Holdings Group Inc. lifted its holdings in Sonic Automotive by 26.2% in the first quarter. Westwood Holdings Group Inc. now owns 641,237 shares of the company's stock valued at $36,525,000 after acquiring an additional 133,044 shares during the last quarter. Nuveen LLC acquired a new position in Sonic Automotive in the first quarter valued at approximately $7,317,000. ProShare Advisors LLC acquired a new position in Sonic Automotive in the second quarter valued at approximately $6,564,000. Finally, HITE Hedge Asset Management LLC lifted its stake in Sonic Automotive by 111.4% during the first quarter. HITE Hedge Asset Management LLC now owns 123,724 shares of the company's stock worth $7,047,000 after purchasing an additional 65,198 shares in the last quarter. Hedge funds and other institutional investors own 46.92% of the company's stock.

About Sonic Automotive

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.