Zacks Investment Research Upgrades Sonic Automotive (SAH) to Buy

Sonic Automotive (NYSE:SAH) was upgraded by Zacks Investment Research from a “hold” rating to a “buy” rating in a research report issued to clients and investors on Tuesday. The brokerage currently has a $20.00 target price on the stock. Zacks Investment Research‘s target price would indicate a potential upside of 12.11% from the stock’s previous close.

According to Zacks, “Sonic Automotive is focusing to expand its network of stores and grow its used-vehicle business to boost sales. Recently in October 2018, the company expanded its EchoPark Automotive to Charlotte, NC. Further, it actively pursues capital deployment strategies to boost shareholder value. It is expected that over the long term, the company has the ability to enhance service capacity and raise revenues. Also, over the past three months shares of Sonic Automotive have outperformed the industry it belongs to. However, rise in its Selling, General and Administrative expenses and foreign exchange rate risk is concerns for the company.”

SAH has been the topic of a number of other research reports. Stephens reiterated a “hold” rating and set a $19.00 target price on shares of Sonic Automotive in a research note on Friday, July 27th. Morgan Stanley lowered their target price on Sonic Automotive from $19.00 to $16.00 and set a “sell” rating on the stock in a research note on Wednesday, August 15th. Buckingham Research lowered their target price on Sonic Automotive from $21.00 to $19.00 and set a “$19.55” rating on the stock in a research note on Wednesday, July 18th. Finally, ValuEngine lowered Sonic Automotive from a “hold” rating to a “sell” rating in a research note on Thursday, September 27th. Two equities research analysts have rated the stock with a sell rating, two have given a hold rating and one has assigned a buy rating to the stock. Sonic Automotive presently has a consensus rating of “Hold” and a consensus price target of $19.40.

SAH opened at $17.84 on Tuesday. Sonic Automotive has a 12-month low of $17.20 and a 12-month high of $23.60. The company has a market capitalization of $826.46 million, a PE ratio of 9.64, a price-to-earnings-growth ratio of 4.36 and a beta of 1.62. The company has a quick ratio of 0.21, a current ratio of 1.03 and a debt-to-equity ratio of 1.19.

Sonic Automotive (NYSE:SAH) last released its quarterly earnings data on Friday, July 27th. The company reported $0.35 earnings per share (EPS) for the quarter, beating the Zacks’ consensus estimate of $0.34 by $0.01. Sonic Automotive had a return on equity of 10.42% and a net margin of 0.95%. The company had revenue of $2.51 billion during the quarter, compared to analysts’ expectations of $2.47 billion. During the same period last year, the firm posted $0.40 earnings per share. The business’s revenue was up 4.2% on a year-over-year basis. As a group, equities research analysts anticipate that Sonic Automotive will post 1.93 earnings per share for the current fiscal year.

Several hedge funds and other institutional investors have recently made changes to their positions in SAH. Northern Trust Corp increased its stake in shares of Sonic Automotive by 0.6% during the first quarter. Northern Trust Corp now owns 1,283,649 shares of the company’s stock worth $24,325,000 after purchasing an additional 7,752 shares during the period. BlackRock Inc. increased its stake in shares of Sonic Automotive by 14.1% during the first quarter. BlackRock Inc. now owns 3,722,619 shares of the company’s stock worth $70,543,000 after purchasing an additional 460,575 shares during the period. JPMorgan Chase & Co. increased its stake in shares of Sonic Automotive by 23.2% during the first quarter. JPMorgan Chase & Co. now owns 72,859 shares of the company’s stock worth $1,381,000 after purchasing an additional 13,699 shares during the period. Municipal Employees Retirement System of Michigan increased its stake in Sonic Automotive by 274.3% during the 2nd quarter. Municipal Employees Retirement System of Michigan now owns 37,020 shares of the company’s stock worth $762,000 after acquiring an additional 27,130 shares during the period. Finally, Piedmont Investment Advisors LLC bought a new position in Sonic Automotive during the 2nd quarter worth $116,000. Institutional investors own 63.73% of the company’s stock.

Sonic Automotive Company Profile

Sonic Automotive, Inc operates as an automotive retailer in the United States. It operates in two segments, Franchised Dealerships and Pre-Owned Stores. 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.

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