AutoNation, Inc. (NYSE:AN) Just Released Its Yearly Earnings: Here's What Analysts Think
Shareholders might have noticed that AutoNation, Inc. (NYSE:AN) filed its yearly result this time last week. The early response was not positive, with shares down 2.1% to US$144 in the past week. AutoNation reported in line with analyst predictions, delivering revenues of US$27b and statutory earnings per share of US$22.74, suggesting the business is executing well and in line with its plan. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
See our latest analysis for AutoNation
Taking into account the latest results, AutoNation's nine analysts currently expect revenues in 2024 to be US$27.3b, approximately in line with the last 12 months. Statutory earnings per share are forecast to tumble 22% to US$19.02 in the same period. In the lead-up to this report, the analysts had been modelling revenues of US$27.0b and earnings per share (EPS) of US$19.28 in 2024. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.
There were no changes to revenue or earnings estimates or the price target of US$162, suggesting that the company has met expectations in its recent result. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic AutoNation analyst has a price target of US$220 per share, while the most pessimistic values it at US$117. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the AutoNation's past performance and to peers in the same industry. It's pretty clear that there is an expectation that AutoNation's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 1.2% growth on an annualised basis. This is compared to a historical growth rate of 6.8% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 5.1% annually. Factoring in the forecast slowdown in growth, it seems obvious that AutoNation is also expected to grow slower than other industry participants.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. The consensus price target held steady at US$162, with the latest estimates not enough to have an impact on their price targets.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for AutoNation going out to 2026, and you can see them free on our platform here.
And what about risks? Every company has them, and we've spotted 3 warning signs for AutoNation (of which 2 can't be ignored!) you should know about.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
