SONIC AUTOMOTIVE INC-CLASS A (SAH) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:SAH - US83545G1022 - Common Stock
61.07 USD
-0.16 (-0.26%)
61.07 USD
0 (0%)
We assign a fundamental rating of 5 out of 10 to SAH. SAH was compared to 122 industry peers in the Specialty Retail industry. SAH has a medium profitability rating, but doesn't score so well on its financial health evaluation. A decent growth rate in combination with a cheap valuation! Better keep an eye on SAH. Finally SAH also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
- SAH had positive earnings in the past year.
- SAH had a positive operating cash flow in the past year.
- SAH had positive earnings in 4 of the past 5 years.
- SAH had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
- Looking at the Return On Assets, with a value of 2.17%, SAH is in line with its industry, outperforming 55.74% of the companies in the same industry.
- Looking at the Return On Equity, with a value of 12.19%, SAH is in the better half of the industry, outperforming 68.85% of the companies in the same industry.
- Looking at the Return On Invested Capital, with a value of 8.31%, SAH is in the better half of the industry, outperforming 70.49% of the companies in the same industry.
- SAH had an Average Return On Invested Capital over the past 3 years of 8.98%. This is below the industry average of 12.24%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.17% | ||
| ROE | 12.19% | ||
| ROIC | 8.31% |
ROA(3y)2.92%
ROA(5y)2.88%
ROE(3y)16.73%
ROE(5y)15.27%
ROIC(3y)8.98%
ROIC(5y)8.83%
1.3 Margins
- SAH has a Profit Margin (0.86%) which is comparable to the rest of the industry.
- In the last couple of years the Profit Margin of SAH has grown nicely.
- SAH has a Operating Margin of 3.64%. This is comparable to the rest of the industry: SAH outperforms 57.38% of its industry peers.
- SAH's Operating Margin has been stable in the last couple of years.
- SAH has a Gross Margin of 15.54%. This is amonst the worse of the industry: SAH underperforms 83.61% of its industry peers.
- In the last couple of years the Gross Margin of SAH has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 3.64% | ||
| PM (TTM) | 0.86% | ||
| GM | 15.54% |
OM growth 3Y-9.02%
OM growth 5Y0.78%
PM growth 3Y-18.59%
PM growth 5Y1.97%
GM growth 3Y-0.06%
GM growth 5Y1.16%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), SAH is creating some value.
- SAH has more shares outstanding than it did 1 year ago.
- The number of shares outstanding for SAH has been reduced compared to 5 years ago.
- The debt/assets ratio for SAH has been reduced compared to a year ago.
2.2 Solvency
- SAH has an Altman-Z score of 3.43. This indicates that SAH is financially healthy and has little risk of bankruptcy at the moment.
- SAH has a Altman-Z score of 3.43. This is in the better half of the industry: SAH outperforms 78.69% of its industry peers.
- The Debt to FCF ratio of SAH is 8.88, which is on the high side as it means it would take SAH, 8.88 years of fcf income to pay off all of its debts.
- SAH has a Debt to FCF ratio (8.88) which is comparable to the rest of the industry.
- A Debt/Equity ratio of 3.54 is on the high side and indicates that SAH has dependencies on debt financing.
- SAH's Debt to Equity ratio of 3.54 is on the low side compared to the rest of the industry. SAH is outperformed by 74.59% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.54 | ||
| Debt/FCF | 8.88 | ||
| Altman-Z | 3.43 |
ROIC/WACC0.99
WACC8.36%
2.3 Liquidity
- SAH has a Current Ratio of 1.02. This is a normal value and indicates that SAH is financially healthy and should not expect problems in meeting its short term obligations.
- SAH has a Current ratio of 1.02. This is in the lower half of the industry: SAH underperforms 74.59% of its industry peers.
- SAH has a Quick Ratio of 1.02. This is a bad value and indicates that SAH is not financially healthy enough and could expect problems in meeting its short term obligations.
- SAH has a Quick ratio of 0.27. This is in the lower half of the industry: SAH underperforms 77.87% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.02 | ||
| Quick Ratio | 0.27 |
3. Growth
3.1 Past
- SAH shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 15.21%, which is quite good.
- Measured over the past years, SAH shows a quite strong growth in Earnings Per Share. The EPS has been growing by 16.23% on average per year.
- Looking at the last year, SAH shows a quite strong growth in Revenue. The Revenue has grown by 9.09% in the last year.
- The Revenue has been growing slightly by 6.35% on average over the past years.
EPS 1Y (TTM)15.21%
EPS 3Y-12.92%
EPS 5Y16.23%
EPS Q2Q%11.9%
Revenue 1Y (TTM)9.09%
Revenue growth 3Y4.69%
Revenue growth 5Y6.35%
Sales Q2Q%13.81%
3.2 Future
- Based on estimates for the next years, SAH will show a quite strong growth in Earnings Per Share. The EPS will grow by 14.29% on average per year.
- Based on estimates for the next years, SAH will show a small growth in Revenue. The Revenue will grow by 7.76% on average per year.
EPS Next Y19.63%
EPS Next 2Y12.48%
EPS Next 3Y11.27%
EPS Next 5Y14.29%
Revenue Next Year8.91%
Revenue Next 2Y6.08%
Revenue Next 3Y5.52%
Revenue Next 5Y7.76%
3.3 Evolution
- The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
- The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- The Price/Earnings ratio is 9.27, which indicates a very decent valuation of SAH.
- Compared to the rest of the industry, the Price/Earnings ratio of SAH indicates a rather cheap valuation: SAH is cheaper than 88.52% of the companies listed in the same industry.
- SAH's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 27.25.
- SAH is valuated reasonably with a Price/Forward Earnings ratio of 8.62.
- Based on the Price/Forward Earnings ratio, SAH is valued cheaper than 90.16% of the companies in the same industry.
- The average S&P500 Price/Forward Earnings ratio is at 25.98. SAH is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.27 | ||
| Fwd PE | 8.62 |
4.2 Price Multiples
- SAH's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. SAH is cheaper than 85.25% of the companies in the same industry.
- Based on the Price/Free Cash Flow ratio, SAH is valued cheaply inside the industry as 95.90% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 4.81 | ||
| EV/EBITDA | 5.57 |
4.3 Compensation for Growth
- SAH's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
PEG (NY)0.47
PEG (5Y)0.57
EPS Next 2Y12.48%
EPS Next 3Y11.27%
5. Dividend
5.1 Amount
- SAH has a Yearly Dividend Yield of 2.40%. Purely for dividend investing, there may be better candidates out there.
- Compared to an average industry Dividend Yield of 2.15, SAH pays a better dividend. On top of this SAH pays more dividend than 81.15% of the companies listed in the same industry.
- SAH's Dividend Yield is a higher than the S&P500 average which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.4% |
5.2 History
- On average, the dividend of SAH grows each year by 27.13%, which is quite nice.
- SAH has paid a dividend for at least 10 years, which is a reliable track record.
- SAH has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)27.13%
Div Incr Years4
Div Non Decr Years14
5.3 Sustainability
- SAH pays out 35.28% of its income as dividend. This is a sustainable payout ratio.
- SAH's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP35.28%
EPS Next 2Y12.48%
EPS Next 3Y11.27%
SONIC AUTOMOTIVE INC-CLASS A / SAH FAQ
What is the ChartMill fundamental rating of SONIC AUTOMOTIVE INC-CLASS A (SAH) stock?
ChartMill assigns a fundamental rating of 5 / 10 to SAH.
What is the valuation status of SONIC AUTOMOTIVE INC-CLASS A (SAH) stock?
ChartMill assigns a valuation rating of 8 / 10 to SONIC AUTOMOTIVE INC-CLASS A (SAH). This can be considered as Undervalued.
Can you provide the profitability details for SONIC AUTOMOTIVE INC-CLASS A?
SONIC AUTOMOTIVE INC-CLASS A (SAH) has a profitability rating of 4 / 10.
How financially healthy is SONIC AUTOMOTIVE INC-CLASS A?
The financial health rating of SONIC AUTOMOTIVE INC-CLASS A (SAH) is 3 / 10.
What is the earnings growth outlook for SONIC AUTOMOTIVE INC-CLASS A?
The Earnings per Share (EPS) of SONIC AUTOMOTIVE INC-CLASS A (SAH) is expected to grow by 19.63% in the next year.