Advertisement
U.S. markets closed
  • S&P 500

    5,254.35
    +5.86 (+0.11%)
     
  • Dow 30

    39,807.37
    +47.29 (+0.12%)
     
  • Nasdaq

    16,379.46
    -20.06 (-0.12%)
     
  • Russell 2000

    2,124.55
    +10.20 (+0.48%)
     
  • Crude Oil

    83.11
    -0.06 (-0.07%)
     
  • Gold

    2,254.80
    +16.40 (+0.73%)
     
  • Silver

    25.10
    +0.18 (+0.74%)
     
  • EUR/USD

    1.0779
    -0.0014 (-0.13%)
     
  • 10-Yr Bond

    4.2060
    +0.0100 (+0.24%)
     
  • GBP/USD

    1.2623
    +0.0001 (+0.01%)
     
  • USD/JPY

    151.2740
    -0.0980 (-0.06%)
     
  • Bitcoin USD

    70,377.43
    +728.34 (+1.05%)
     
  • CMC Crypto 200

    885.54
    0.00 (0.00%)
     
  • FTSE 100

    7,952.62
    +20.64 (+0.26%)
     
  • Nikkei 225

    40,352.68
    +184.61 (+0.46%)
     

Sonic's EchoPark Expansion on Track With 2nd Houston Store

Sonic Automotive SAH recently announced the opening of its second EchoPark-branded auto dealership in Houston, in a bid to expand the distribution network. Notably, this will be EchoPark’s 11th retail hub location on a nationwide basis.

The used-car segment EchoPark is the major growth engine of Sonic. The company’s focus on expanding the network of stores is set to bolster prospects. Sonic plans to add 25 EchoPark locations per year from 2021 to 2025. Importantly, it remains committed to sell more than half a million vehicles annually by 2025 via a 140-plus point nationwide distribution network. It should be noted that the firm targets $14 billion in annual EchoPark revenues by 2025.

Strong organic growth fueled by EchoPark expansion is likely to significantly boost Sonic’s growth profile. EchoPark investments are anticipated to drive significant unit share gains, going forward. The segment generated revenues of $1.2 billion and segmental income of $9.1 million, up 66% and 117%, respectively, from 2019. Despite coronavirus woes, the EchoPark segment recorded higher year-over-year sales in the last reported quarter. The trend is expected to continue.

The firm’s digital ramp up amid the pandemic is also aiding revenues. In response to coronavirus-led lockdown, the firm began to offer a no-contact purchase experience, allowing 90% of a vehicle transaction to be completed on its website or by phone and delivered to the guest with a safe, no-contact home delivery. Strategic partnership with Cox Automotive and Darwin Automotive to develop a proprietary e-commerce platform and user interface bodes well for Sonic Automotive. This digital retailing partnership is expected to further speed up the firm’s EchoPark expansion plans.

Sonic presently sports a Zacks Rank #1 (Strong Buy). Other top-ranked auto retailers include Lithia Motors LAD, AutoNation AN and Penske Automotive PAG, each flaunting a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Zacks’ Single Best Pick to Double

From thousands of stocks, 5 Zacks experts each picked their favorite to gain +100% or more in months to come. From those 5, Zacks Director of Research, Sheraz Mian hand-picks one to have the most explosive upside of all.

With users in 180 countries and soaring revenues, it’s set to thrive on remote working long after the pandemic ends. No wonder it recently offered a stunning $600 million stock buy-back plan.

The sky’s the limit for this emerging tech giant. And the earlier you get in, the greater your potential gain.

Click Here, See It Free >>


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Penske Automotive Group, Inc. (PAG) : Free Stock Analysis Report
 
AutoNation, Inc. (AN) : Free Stock Analysis Report
 
Sonic Automotive, Inc. (SAH) : Free Stock Analysis Report
 
Lithia Motors, Inc. (LAD) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research

Advertisement