One of the top U.S. auto retailers, AutoNation, rose to new all-time highs after reporting better-than-expected earnings.
Its earnings per share of $6.37 beat the $5.83 consensus estimate. And revenues of $6.7 billion (+2% YoY) topped the $6.52 billion expected. 💪
The company experienced poor performance in its used-vehicle segment, where prices have fallen, and demand has stalled. However, demand for new vehicles, spare parts, and services offset that weakness. Revenue from new vehicles and after-sales were up 8% and 7%, respectively, while used-vehicle sales were down 8% YoY.
Executives say improving supply chains have caused new vehicle prices to come down and transactions to pick up, as dealers are able to fulfill customer orders. They expect new vehicle demand to remain strong but transactions and prices to settle below their post-pandemic peak, which was unsustainable. ⛰️
While some analysts are concerned about the macro environment impacting consumer spending, others say new auto sales will stay strong given the last few years of depressed activity.
$AN shares rose 11% on the day to fresh all-time highs. 📈
