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Research Alert: CFRA Maintains Hold Opinion On Shares Of Sonic Automotive Inc.
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Research Alert: CFRA Maintains Hold Opinion On Shares Of Sonic Automotive Inc.
Jul 25, 2025 10:47 PM

12:20 AM EDT, 07/25/2025 (MT Newswires) -- CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:

We maintain a 12-month target of $85, based on a 2026 P/E of 11.5x, a premium to historic averages justified by early-cycle market conditions. We raise our adjusted EPS estimates to $7.10 (from $6.00) for 2025 and to $7.40 (from $7.25) for 2026. Following much better-than-expected Q2 2025 earnings, we raise our estimates but maintain our Hold opinion on SAH shares. SAH posted Q2 adjusted EPS of $2.19 vs. $1.47 (+49%), well ahead of the $1.63 consensus. Revenue rose 6% to $3.66B ($20M below consensus) and gross margin expanded 90 bps to 16.5% (110 bps above consensus). SAH also announced a 9% dividend increase to $1.52/share annualized. While SAH's release was strong, valuation keeps us on the sidelines after a big run-up over the last few months. We prefer other names in auto retail, the only automotive sub-industry we currently rate with a positive outlook. We think strong earnings releases from SAH and other auto dealers bode favorably for the group, which benefited from higher sales early in the quarter.

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