Asbury Automotive Group, Inc. (ABG) Fundamental Analysis: Bull vs. Bear Case

ABG

Asbury Automotive Group, Inc.

Fundamental data last updated:May 13, 2026

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company profile

SECTOR

Consumer Cyclical

industry

Auto - Dealerships

Exchange

NYSE

County of HQ

US

Next Earnings Date

07/28/2026

Business Summary

Asbury Automotive Group, Inc., together with its subsidiaries, operates as an automotive retailer in the United States. It offers a range of automotive products and services, including new and used vehicles; and vehicle repair and maintenance services, replacement parts, and collision repair services. The company also provides finance and insurance products, including arranging vehicle financing through third parties; and aftermarket products, such as extended service contracts, guaranteed asset protection debt cancellation, prepaid maintenance, and credit life and disability insurance. As of December 31, 2021, the company owned and operated 205 new vehicle franchises representing 31 brands of automobiles at 155 dealership locations; and 35 collision centers in the United States. Asbury Automotive Group, Inc. was founded in 1996 and is headquartered in Duluth, Georgia.

VALUATION

P/E

9.10 Market Cap ($M USD)

$3.64B

Forward P/E

6.18 PEG

0.13 PRICE TO SALES

0.20 PRICE TO BOOK

0.95 EV / EBITDA

9.21 5-Year Average P/E

Free Cash Flow Yield

16.52%

DCF Value

$669.88

Graham Number

$316.26

Price to FCF

6.05 EV to FCF

15.04 Earnings Yield

10.98%

FCF Yield

16.52%

DIVIDEND

Yield

0.00%

Annual Payout

$0.00

Payout Ratio

0.00%

Consecutive Years of Dividend Growth

5-Year Dividend Growth Rate

Financial Health & Profitability

Earnings Per Share

$21.48

Next Year EPS Growth Estimate

$31.66

Next Year Revenue Growth Estimate

$2.03T

Return on Equity (ROE)

10.55%

FREE CASH FLOW

Operating Margin

5.21%

Debt-to-Equity

1.63 Piotroski F-Score

5 Altman Z-Score

2.59 Return on Invested Capital (ROIC)

11.57%

Current Ratio

0.94 Quick Ratio

0.29 Net Debt to EBITDA

5.50 Interest Coverage

3.28 Gross Profit margin

16.86%

FCF PER SHARE

$31.66

REVENUE PER SHARE

$945.45

Gainseekers Quantitative Analysis

Summary

ABG’s valuation presents a compelling opportunity for deep value investors. The stock traded significantly below its DCF value, suggesting a market mispricing. With a Forward P/E of 6.33 and an Earnings Yield of 10.72%, the company appears undervalued relative to its earnings potential. However, the Altman Z-score of 2.59 indicates moderate financial distress, suggesting caution. Despite this, the Graham Number further supports the notion of undervaluation, hinting at potential upside if the market corrects its pricing.

AI Exposure / Tech Reliance

Operating in the auto dealership industry, ABG faces challenges and opportunities from AI and tech shifts. While traditional dealerships may struggle with digital transformation, those that embrace online sales platforms and AI-driven customer insights can thrive. ABG's ability to adapt will be crucial in maintaining its competitive edge.

The Bull Case

For value or GARP investors, ABG offers a tantalizing proposition. The ROIC of 11.57% showcases strong capital efficiency, while a robust FCF Yield of 16.12% indicates significant cash generation potential. A Piotroski F-Score of 5 suggests moderate financial health, and an operating margin of 5.21% highlights effective cost management. These metrics paint a picture of a company with solid pricing power and efficient capital allocation.

The Bear Case

Despite its strengths, ABG faces structural risks that cannot be ignored. The company's high Debt/Equity ratio of 1.63 raises concerns about leverage, while a Net Debt to EBITDA of 5.50 suggests potential liquidity issues. The Quick Ratio of 0.29 indicates limited short-term liquidity, posing a risk in volatile markets. Additionally, trading near its 52-week high, the stock may be technically overextended, warranting caution.

Market Sentiment & Smart Money

Short Interest %

Analyst Consensus

Hold

Average Analyst Price Target

$234.67

Institutional Ownership %

1-Year Beta

0.78 Insider Buying % (6 Mo)

Distance to 52-Week High

40.36%

Distance to 52-Week Low

5.61%

EARNINGS SURPRISE %

-4.45%

50-DAY SMA

$199.74

200-DAY SMA

$228.17

⚠️ Financial Disclaimer:
This content is for informational purposes only and is not financial advice. Information may be delayed or inaccurate. We may earn a commission from partner links.