AutoNation, Inc. (AN) Fundamental Analysis: Bull vs. Bear Case

AN

AutoNation, Inc.

Fundamental data last updated:June 16, 2026

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company profile

SECTOR

Consumer Cyclical

industry

Auto - Dealerships

Exchange

NYSE

County of HQ

US

Next Earnings Date

07/24/2026

Business Summary

AutoNation, Inc., through its subsidiaries, operates as an automotive retailer in the United States. The company operates through three segments: Domestic, Import, and Premium Luxury. It offers a range of automotive products and services, including new and used vehicles; and parts and services, such as automotive repair and maintenance, and wholesale parts and collision services. The company also provides automotive finance and insurance products comprising vehicle services and other protection products, as well as arranges finance for vehicle purchases through third-party finance sources. As of December 31, 2021, it owned and operated 339 new vehicle franchises from 247 stores located primarily in metropolitan markets in the Sunbelt region. The company also owned and operated 57 AutoNation-branded collision centers, 9 AutoNation USA used vehicle stores, 4 AutoNation-branded automotive auction operations, and 3 parts distribution centers. AutoNation, Inc. was founded in 1991 and is headquartered in Fort Lauderdale, Florida.

VALUATION

P/E

9.59 Market Cap ($M USD)

$6.28B

Forward P/E

5.80 PEG

0.09 PRICE TO SALES

0.23 PRICE TO BOOK

2.93 EV / EBITDA

10.82 5-Year Average P/E

Free Cash Flow Yield

-1.66%

DCF Value

$433.94

Graham Number

$168.09

Price to FCF

-60.40

EV to FCF

-160.00

Earnings Yield

10.42%

FCF Yield

-1.66%

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

$19.57

Next Year EPS Growth Estimate

$32.36

Next Year Revenue Growth Estimate

$3.01T

Return on Equity (ROE)

28.44%

FREE CASH FLOW

Operating Margin

4.45%

Debt-to-Equity

4.35 Piotroski F-Score

5 Altman Z-Score

2.98 Return on Invested Capital (ROIC)

13.59%

Current Ratio

0.81 Quick Ratio

0.20 Net Debt to EBITDA

6.74 Interest Coverage

3.54 Gross Profit margin

17.51%

FCF PER SHARE

$-3.00

REVENUE PER SHARE

$792.31

Gainseekers Quantitative Analysis

Summary

AutoNation, Inc. appears to be significantly undervalued when juxtaposed with its DCF Value and Graham Number, suggesting a market mispricing. The Forward P/E of 6.37 and an Earnings Yield of 9.5% indicate a compelling growth opportunity at a reasonable price. With an Altman Z-score of 3.02, the company demonstrates financial stability, reducing the risk of bankruptcy. However, the high Debt/Equity ratio of 4.35 raises concerns about leverage, though the company’s robust Return on Equity of 28.44% showcases effective management and capital utilization. Overall, the stock presents a mixed picture of value and risk.

AI Exposure / Tech Reliance

In the auto dealership industry, AutoNation is poised to leverage AI and tech advancements to streamline operations and enhance customer experiences. The sector's shift towards digital retailing and AI-driven inventory management could bolster efficiency. However, the company must continuously innovate to stay ahead in a rapidly evolving tech landscape.

The Bull Case

For the value-driven investor, AutoNation offers a tantalizing proposition. The impressive ROIC of 13.59% underscores its ability to generate returns well above its cost of capital, indicating strong capital efficiency. Despite a negative FCF Yield, the Piotroski F-Score of 5 suggests moderate financial health, while the operating margin of 4.45% reflects decent pricing power. These factors, combined with a low PEG Forward ratio of 0.097, make it an attractive option for those seeking growth at a reasonable price.

The Bear Case

Yet, the bear case cannot be ignored. The Price/Book ratio of 3.21 and Price/Sales ratio of 0.25 suggest the stock might be overvalued relative to its book and sales values. The negative Free Cash Flow and an EV to FCF ratio of -165.95 highlight significant cash flow challenges. Additionally, with the stock trading close to its 52-week high, it may be technically overextended, posing a risk of a pullback. These structural weaknesses could deter cautious investors.

Market Sentiment & Smart Money

Short Interest %

Analyst Consensus

Buy

Average Analyst Price Target

$233.80

Institutional Ownership %

1-Year Beta

0.79 Insider Buying % (6 Mo)

Distance to 52-Week High

21.95%

Distance to 52-Week Low

5.91%

EARNINGS SURPRISE %

-0.42%

50-DAY SMA

$196.68

200-DAY SMA

$205.93

⚠️ 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.