SONIC AUTOMOTIVE INC-CLASS A (SAH) Stock Fundamental Analysis
NYSE:SAH - New York Stock Exchange, Inc. - US83545G1022 - Common Stock - Currency: USD
Taking everything into account, SAH scores 4 out of 10 in our fundamental rating. SAH was compared to 121 industry peers in the Specialty Retail industry. SAH has a medium profitability rating, but doesn't score so well on its financial health evaluation. SAH has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
SAH had positive earnings in the past year.
In the past year SAH had a positive cash flow from operations.
Of the past 5 years SAH 4 years were profitable.
SAH had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
With a decent Return On Assets value of 4.16%, SAH is doing good in the industry, outperforming 65.29% of the companies in the same industry.
SAH's Return On Equity of 22.42% is fine compared to the rest of the industry. SAH outperforms 79.34% of its industry peers.
SAH's Return On Invested Capital of 7.76% is fine compared to the rest of the industry. SAH outperforms 67.77% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for SAH is below the industry average of 13.07%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.16% | ||
| ROE | 22.42% | ||
| ROIC | 7.76% |
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 (1.69%) which is in line with its industry peers.
In the last couple of years the Profit Margin of SAH has grown nicely.
The Operating Margin of SAH (3.48%) is comparable to the rest of the industry.
In the last couple of years the Operating Margin of SAH has remained more or less at the same level.
SAH has a Gross Margin of 15.34%. This is amonst the worse of the industry: SAH underperforms 87.60% 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 | 3.48% | ||
| PM (TTM) | 1.69% | ||
| GM | 15.34% |
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
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so SAH is still 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
An Altman-Z score of 3.52 indicates that SAH is not in any danger for bankruptcy at the moment.
The Altman-Z score of SAH (3.52) is better than 79.34% of its industry peers.
SAH has a debt to FCF ratio of 82.25. This is a negative value and a sign of low solvency as SAH would need 82.25 years to pay back of all of its debts.
SAH's Debt to FCF ratio of 82.25 is in line compared to the rest of the industry. SAH outperforms 46.28% of its industry peers.
A Debt/Equity ratio of 3.40 is on the high side and indicates that SAH has dependencies on debt financing.
The Debt to Equity ratio of SAH (3.40) is worse than 76.03% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.4 | ||
| Debt/FCF | 82.25 | ||
| Altman-Z | 3.52 |
ROIC/WACC0.88
WACC8.77%
2.3 Liquidity
SAH has a Current Ratio of 1.09. This is a normal value and indicates that SAH is financially healthy and should not expect problems in meeting its short term obligations.
SAH's Current ratio of 1.09 is on the low side compared to the rest of the industry. SAH is outperformed by 68.59% of its industry peers.
A Quick Ratio of 0.38 indicates that SAH may have some problems paying its short term obligations.
SAH has a worse Quick ratio (0.38) than 61.98% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.09 | ||
| Quick Ratio | 0.38 |
3. Growth
3.1 Past
The earnings per share for SAH have decreased strongly by -16.37% in the last year.
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.
The Revenue has been growing slightly by 1.59% in the past year.
Measured over the past years, SAH shows a small growth in Revenue. The Revenue has been growing by 6.35% on average per year.
EPS 1Y (TTM)-16.37%
EPS 3Y-12.92%
EPS 5Y16.23%
EPS Q2Q%8.82%
Revenue 1Y (TTM)1.59%
Revenue growth 3Y4.69%
Revenue growth 5Y6.35%
Sales Q2Q%7.9%
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 15.45% on average per year.
The Revenue is expected to grow by 7.76% on average over the next years.
EPS Next Y12.84%
EPS Next 2Y12.14%
EPS Next 3Y12.93%
EPS Next 5Y15.45%
Revenue Next Year5.54%
Revenue Next 2Y4.48%
Revenue Next 3Y5.91%
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 15.31, SAH is valued correctly.
77.69% of the companies in the same industry are more expensive than SAH, based on the Price/Earnings ratio.
The average S&P500 Price/Earnings ratio is at 27.45. SAH is valued slightly cheaper when compared to this.
A Price/Forward Earnings ratio of 12.43 indicates a correct valuation of SAH.
75.21% of the companies in the same industry are more expensive than SAH, based on the Price/Forward Earnings ratio.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.90, SAH is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.31 | ||
| Fwd PE | 12.43 |
4.2 Price Multiples
71.07% of the companies in the same industry are more expensive than SAH, based on the Enterprise Value to EBITDA ratio.
The rest of the industry has a similar Price/Free Cash Flow ratio as SAH.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 64.23 | ||
| EV/EBITDA | 7.58 |
4.3 Compensation for Growth
SAH's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
A more expensive valuation may be justified as SAH's earnings are expected to grow with 12.93% in the coming years.
PEG (NY)1.19
PEG (5Y)0.94
EPS Next 2Y12.14%
EPS Next 3Y12.93%
5. Dividend
5.1 Amount
SAH has a Yearly Dividend Yield of 1.60%.
Compared to an average industry Dividend Yield of 5.03, SAH pays a bit more dividend than its industry peers.
Compared to the average S&P500 Dividend Yield of 2.38, SAH is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.6% |
5.2 History
On average, the dividend of SAH grows each year by 27.13%, which is quite nice.
SAH has been paying a dividend for at least 10 years, so it has a reliable track record.
SAH has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)27.13%
Div Incr Years4
Div Non Decr Years14
5.3 Sustainability
SAH pays out 17.38% 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.
DP17.38%
EPS Next 2Y12.14%
EPS Next 3Y12.93%
87.57
+1.15 (+1.33%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)
Earnings (Next)
Inst Owners70.87%
Inst Owner Change-47.39%
Ins Owners28.46%
Ins Owner Change-2.7%
Market Cap2.97B
Analysts77.14
Price Target75.1 (-14.24%)
Short Float %9.87%
Short Ratio7.38
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.6% |
Yearly Dividend1.2
Dividend Growth(5Y)27.13%
DP17.38%
Div Incr Years4
Div Non Decr Years14
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)1.9%
Min EPS beat(2)1.52%
Max EPS beat(2)2.28%
EPS beat(4)3
Avg EPS beat(4)-0.83%
Min EPS beat(4)-12.77%
Max EPS beat(4)5.65%
EPS beat(8)6
Avg EPS beat(8)1%
EPS beat(12)7
Avg EPS beat(12)-1.69%
EPS beat(16)10
Avg EPS beat(16)5.48%
Revenue beat(2)2
Avg Revenue beat(2)4.97%
Min Revenue beat(2)3.11%
Max Revenue beat(2)6.82%
Revenue beat(4)2
Avg Revenue beat(4)0.69%
Min Revenue beat(4)-4.59%
Max Revenue beat(4)6.82%
Revenue beat(8)4
Avg Revenue beat(8)0%
Revenue beat(12)5
Avg Revenue beat(12)-1.91%
Revenue beat(16)7
Avg Revenue beat(16)-1.2%
PT rev (1m)5.39%
PT rev (3m)-7.47%
EPS NQ rev (1m)0%
EPS NQ rev (3m)4.27%
EPS NY rev (1m)1.36%
EPS NY rev (3m)0.31%
Revenue NQ rev (1m)-0.67%
Revenue NQ rev (3m)2.6%
Revenue NY rev (1m)-0.14%
Revenue NY rev (3m)0.8%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.31 | ||
| Fwd PE | 12.43 | ||
| P/S | 0.21 | ||
| P/FCF | 64.23 | ||
| P/OCF | 12.67 | ||
| P/B | 2.73 | ||
| P/tB | 9.81 | ||
| EV/EBITDA | 7.58 |
EPS(TTM)5.72
EY6.53%
EPS(NY)7.04
Fwd EY8.04%
FCF(TTM)1.36
FCFY1.56%
OCF(TTM)6.91
OCFY7.9%
SpS426.73
BVpS32.12
TBVpS8.92
PEG (NY)1.19
PEG (5Y)0.94
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.16% | ||
| ROE | 22.42% | ||
| ROCE | 15.52% | ||
| ROIC | 7.76% | ||
| ROICexc | 7.86% | ||
| ROICexgc | 9.3% | ||
| OM | 3.48% | ||
| PM (TTM) | 1.69% | ||
| GM | 15.34% | ||
| FCFM | 0.32% |
ROA(3y)2.92%
ROA(5y)2.88%
ROE(3y)16.73%
ROE(5y)15.27%
ROIC(3y)8.98%
ROIC(5y)8.83%
ROICexc(3y)9.23%
ROICexc(5y)9.2%
ROICexgc(3y)10.85%
ROICexgc(5y)10.93%
ROCE(3y)16.97%
ROCE(5y)16.85%
ROICexcg growth 3Y-14.51%
ROICexcg growth 5Y-0.73%
ROICexc growth 3Y-12.08%
ROICexc growth 5Y-0.71%
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%
F-Score5
Asset Turnover2.47
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.4 | ||
| Debt/FCF | 82.25 | ||
| Debt/EBITDA | 5.82 | ||
| Cap/Depr | 141.41% | ||
| Cap/Sales | 1.3% | ||
| Interest Coverage | 2.54 | ||
| Cash Conversion | 36.84% | ||
| Profit Quality | 18.93% | ||
| Current Ratio | 1.09 | ||
| Quick Ratio | 0.38 | ||
| Altman-Z | 3.52 |
F-Score5
WACC8.77%
ROIC/WACC0.88
Cap/Depr(3y)168.98%
Cap/Depr(5y)194.01%
Cap/Sales(3y)1.45%
Cap/Sales(5y)1.61%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-16.37%
EPS 3Y-12.92%
EPS 5Y16.23%
EPS Q2Q%8.82%
EPS Next Y12.84%
EPS Next 2Y12.14%
EPS Next 3Y12.93%
EPS Next 5Y15.45%
Revenue 1Y (TTM)1.59%
Revenue growth 3Y4.69%
Revenue growth 5Y6.35%
Sales Q2Q%7.9%
Revenue Next Year5.54%
Revenue Next 2Y4.48%
Revenue Next 3Y5.91%
Revenue Next 5Y7.76%
EBIT growth 1Y-0.02%
EBIT growth 3Y-4.75%
EBIT growth 5Y7.18%
EBIT Next Year30.8%
EBIT Next 3Y14.9%
EBIT Next 5Y12.81%
FCF growth 1Y153.9%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y96.32%
OCF growth 3Y-29.11%
OCF growth 5Y-8.59%