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Stocks
Sonic Automotive, Inc.
SAH

SAH Sonic Automotive, Inc.

Sonic Automotive, Inc. · NYSE
Market Closed
75.90
▼ ⁦-0.81%⁩ (-0.62)
Market Cap$2.5B
Beta0.89
52w Low52w High
54.11105.68
Last Week
⁦-4.43%⁩
Last Month
⁦-7.93%⁩
Last 3 Months
⁦-9.19%⁩
Last Year
⁦-8.00%⁩
EL7 Factor Analysis
How we score this
Overall58
Balanced — near the middle of the marketTurnaroundF 5/8SafeBetter than 58% of Market stocks, per EL7's model
FactorScoreDistributionValueAvgRank
▸
Valuation
89
12.0x▲17.8xTop tier
▸
Growth
43
5.3%▼7.1%Around median
▸
Quality
47
17.0%▲4.5%Around median
▸
Safety
43
3.3x▼2.6xAround median
▸
Capital Return
41
1.78%▼2.12%Around median
▸
Momentum
61
3.3%▲2.9%Around median
▸
Sentiment
34
7▲3Bottom tier
Fair Value
Current price$76
Analyst target · 5 analysts
$89
⁦+17%⁩
See it undervalued
Range ⁦$72–$139⁩
vs
DCF (estimate)
$-12.96
⁦-117%⁩
Sees it clearly overvalued
⁦8.3⁩% discount · ⁦0⁩% growth
Bottom lineThe two methods disagree — estimate range ⁦$-12.96–$89⁩.

Estimates — analyst targets and a simplified DCF, not investment advice.

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Analyst Consensus

This section combines price targets, revision history, analyst coverage changes, and an AI summary of what changed on the Street.

Price Target· 5 analysts setting price target
$99.20
⁦+30.7%⁩
Current Price $75.90·Median $89.00
Low
$72.00
High
$139.00
Current price
$75.90
Average target
$99.20
Street summary

Analysis of Sonic Automotive (SAH) Price Target Revisions

The price target for SAH has seen mixed shifts; the overall average rose by 9.61% over the past thirty days to reach $99.2, driven by an increase in the number of analysts from 3 to 5. However, this average declined slightly by 1% in the last week. A sharp dispersion is evident in the forecasts between the minimum (72) and maximum (139), with the median price (89) being significantly lower than the average, indicating that high expectations from a minority of analysts are skewing the overall average asymmetrically.

As of 2026-08-24
Revisions momentum · 30d
⁦-1.0%⁩
Average rating
★ 3.42
Hold
Analyst coverage
12
Buy conviction
50%
Mixed
Target dispersion
88%
Wide
Analyst ratings over time12 analysts rating
2
4
4
1
1
Strong BuyBuyHoldSellStrong Sell
Rating trend — last 12 months3.55 → 3.42
Recent analyst moves
  • ⬇ Downgrade2026-08-06
    Morgan Stanley
    Equal-WeightUnderweight
  • = Reiterate2026-07-31
    Needham
    Buy
  • ⬇ Downgrade2026-07-17
    Seaport Global
    BuyNeutral
Premium content
Key Financials

Ten ratios that matter, each compared against its sector median and average — so you can see whether a number is rich or cheap relative to peers in the same sector.

StockSector medianSector averagetypical sector range
MetricValuePosition within sectorVerdict
  • P/E (TTM)
    12.05x
    4.56x36.49x
    Cheap
  • Forward P/E
    10.49x
    3.79x30.29x
    Very cheap
  • EV / EBITDA
    6.92x
    2.75x22.03x
    Very cheap
  • FCF Yield
    3.9%
    -30.9%16.2%
    Strong
  • Revenue Growth YoY
    5.3%
    -13.8%31.9%
    Near median
  • EPS Growth YoY
    38.5%
    -156.9%135.6%
    Above average
  • Gross Margin
    15.7%
    12.0%66.5%
    Weak
  • ROIC
    17.0%
    -23.8%21.5%
    Strong
  • Net Debt / EBITDA
    3.30x
    0.65x5.48x
    Low debt
  • Dividend Yield
    1.8%
    0.1%5.9%
    Moderate
  • Payout Ratio
    22.3%
    8.9%99.8%
    Low
  • Altman Z-Score
    3.31
    -2.656.14
    Above average
Financial Analysis
|

Stock Analysis

AI-generated
Based on 2026-07-30 data

Company Overview

Sonic Automotive operates through three interconnected segments: franchised dealerships, EchoPark used-car sales, and the powersports segment. The company generates revenue from new and used vehicle sales, while maintenance services, parts, finance, and insurance provide higher-margin and more recurring profit streams; in Q2 FY2026, fixed operations and finance and insurance represented more than 75% of total gross profit.

In Q2 FY2026, Sonic Automotive reported record second-quarter revenue of $3.9B, up 8% year over year, and record gross profit of $616.2M, up 2%. Net income was $57.4M and diluted earnings per share were $1.79, while adjusted earnings per share were $1.82. These figures equate to a gross margin of approximately 15.8% and a net income margin of approximately 1.5% based on reported revenue.

The dealership segment remained the largest contributor, with revenue of $3.3B, followed by EchoPark with revenue of $582.9M, then powersports with revenue of $73.5M. During the trailing twelve-month period in 2026, revenue reached $15.5B, gross profit $2.4B, net income $211.9M, and earnings per share approximately $6.60, compared with revenue of $15.2B, net income of $118.7M, and earnings per share of $3.42 in FY2025.

What's Driving the Stock

  • In Q2 FY2026, EchoPark achieved 15% revenue growth to $582.9M and a 17% increase in used retail vehicle sales volume to 19.6 thousand vehicles, while the share of vehicles sourced outside auctions rose from 32% in the previous quarter to 42%.
  • Fixed operations gross profit reached a quarterly record of $263.8M, up 6%, while finance and insurance gross profit in the dealership segment reached a second-quarter record of $147.9M, up 2%, supporting profitability despite lower new-vehicle profit.
Earnings callEDGAR filings30-day newsInsider activity

Automated analysis for informational purposes only — not investment advice.

  • Management raised its FY2026 outlook range for new-vehicle profit to between $2.85K and $3.00K and set an EchoPark gross profit target of between $3.1K and $3.3K per vehicle, with sales volume growth of between 12% and 15%. It also maintained its EchoPark adjusted earnings before interest, taxes, depreciation, and amortization outlook at between $35M and $40M.
  • Powersports segment revenue grew 53% to $73.5M in Q2 FY2026, and gross profit rose 57% to $19.7M, while adjusted earnings before interest, taxes, depreciation, and amortization increased 145% to $4.9M. The acquired Harley-Davidson dealerships in California, Florida, Georgia, and North Carolina contributed to this expansion.
  • The company ended Q2 FY2026 with available liquidity of approximately $676M, including about $294M in cash and floor plan deposits. It intends to spend between $8M and $12M on EchoPark brand marketing in Q4 FY2026, open a location in Orlando during that quarter, and then open two to four locations in 2027.
  • Buying & Selling Case

    ▲ Buying Case4 pts

    • +The earnings mix provides some protection against fluctuations in vehicle sales margins, as fixed operations and finance and insurance generated more than 75% of total gross profit in Q2 FY2026, with the two areas recording gross profit of $263.8M and $147.9M, respectively.
    • +EchoPark demonstrates a clear ability to convert improved used-vehicle availability into volume growth; units rose 17% in Q2 FY2026, while the share of sourcing outside auctions increased ten percentage points to 42%, and management says existing stores have capacity approaching twice their current volume.
    • +The powersports segment adds a growth driver that is less dependent on traditional automotive dealerships; its revenue grew 53% and gross profit rose 57% in Q2 FY2026, while segment income improved to $2.3M from breakeven in the comparable period.
    • +Available liquidity of approximately $676M gives the company flexibility to fund expansion, acquisitions, and capital returns, and the board approved a cash dividend of $0.41 per share payable on October 15, 2026, to shareholders of record on September 15, 2026.

    ▼ Selling Case6 pts

    • −The business depends heavily on the dealership segment, which generated $3.3B of the $3.9B in Q2 FY2026 revenue, and therefore remains exposed to vehicle affordability challenges and tariffs; management noted that one in five customers has a monthly payment exceeding $1K.
    • −Profit growth did not keep pace with sales growth in Q2 FY2026; revenue rose 8% while gross profit increased only 2%, and comparable dealership store gross profit declined 3%. Reported new-vehicle profit also fell 11% year over year to $3.02K, revealing a slowdown in the quality of growth.
    • −EchoPark's economics face pressure from its inventory mix; gross profit per vehicle declined 12% to $3.29K, front-end used-vehicle profit fell 21% to $328, and finance and insurance profit per vehicle decreased 11% to $2.96K. Electric vehicles represented approximately 15% of EchoPark's volume, and lower service contract penetration and profit per contract were among the causes of the pressure.
    • −Comparable-store fixed operations gross profit growth slowed to 2% in Q2 FY2026, below management's ambition for mid- to high-single-digit growth. Management acknowledged that dealership service pricing is high, requiring lower prices and improved marketing to win customers back from independent repair shops without weakening margins.
    • −Uneven competition and regulatory compliance could affect EchoPark; the company says it complies with Federal Trade Commission guidelines, while some competitors advertise prices that do not fully include fees. Management explained that this behavior caused disruption in some markets, although it did not identify a material impact on Sonic Automotive's business during Q2 FY2026.
    • −The neutral analyst consensus and wide target range of $72 to $139 reflect significant disagreement about fair value, while the average target of $99.2 is below the 52-week range high of $113.67. This divergence makes value realization dependent on demonstrating the sustainability of EchoPark's growth, a recovery in fixed operations, and stabilization in vehicle sales margins.

    Valuation

    The analyst consensus on SAH is neutral, with an average price target of $99.2 and a wide range between $72 and $139. The average is below the 52-week range high of $113.67 and above its low of $54.11, while the highest target exceeds the previous high, reflecting notable differences in assessments of the impact of EchoPark and powersports growth versus margin and vehicle affordability pressures. The data do not support a one-directional valuation view, particularly with quarterly revenue growth of 8% compared with gross profit growth of only 2%.

    HoldAnalyst target: $99.2(+30.7%)

    Figures in the text are as of 2026-09-01; the live price is shown at the top of the page.

    FAQ

    What drove SAH's results in Q2 FY2026?

    Sonic Automotive reported revenue of $3.9B and gross profit of $616.2M in Q2 FY2026, representing year-over-year increases of 8% and 2%. Net income was $57.4M and diluted earnings per share were $1.79, while adjusted earnings were $1.82 per share. The main support came from EchoPark's growth, record fixed operations gross profit of $263.8M, and record dealership finance and insurance gross profit of $147.9M.

    Is EchoPark's growth profitable, or does it depend only on increasing the number of vehicles sold?

    EchoPark's revenue rose 15% to $582.9M, and units sold increased 17% to 19.6 thousand vehicles in Q2 FY2026. In contrast, gross profit per vehicle declined 12% to $3.29K, due to a 21% decrease in front-end profit per vehicle and an 11% decrease in finance and insurance profit per vehicle. For FY2026, management is targeting gross profit of between $3.1K and $3.3K per vehicle, unit growth of between 12% and 15%, and adjusted earnings before interest, taxes, depreciation, and amortization of between $35M and $40M.

    Why are fixed operations and finance and insurance important to SAH stock?

    Together, fixed operations and finance and insurance represented more than 75% of Sonic Automotive's total gross profit in Q2 FY2026. Reported fixed operations gross profit rose 6% to $263.8M, and dealership finance and insurance gross profit increased 2% to $147.9M. These higher-margin businesses helped offset an 11% decline in reported new-vehicle profit to $3.02K.

    How important is the powersports segment to Sonic Automotive's growth story?

    Powersports segment revenue reached $73.5M in Q2 FY2026, up 53%, while gross profit rose 57% to $19.7M. New unit sales volume increased 27%, used unit sales volume rose 61%, and finance and insurance revenue grew 75% to $3.5M. The acquired Harley-Davidson dealerships in California, Florida, Georgia, and North Carolina contributed to the growth, while segment income reached $2.3M compared with breakeven in the comparable period.

    What are the main risks associated with Sonic Automotive's margins in FY2026?

    Dealerships face pressure from higher vehicle prices and tariffs, which reduced reported new-vehicle profit by 11% year over year in Q2 FY2026. At EchoPark, a higher mix of electric vehicles and higher-mileage vehicles reduced service contract penetration and gross profit per vehicle to $3.29K. Comparable-store fixed operations gross profit also grew only 2%, placing pressure on service pricing and marketing initiatives to achieve the mid-single-digit growth target.

    What do liquidity and dividends indicate about capital allocation at SAH?

    Sonic Automotive had approximately $676M in available liquidity resources at the end of Q2 FY2026, including about $294M in cash and floor plan deposits. Management said these resources support organic investment, acquisitions, and returns of capital to shareholders. The board approved a cash dividend of $0.41 per share, payable on October 15, 2026, to shareholders of record on September 15, 2026.