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Cars and Drivers

AutoNation Posts Best-Ever Earnings (AN, CRMT, KMX, F, GM, TM, HMC, NSANY)

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By Paul Ausick Published
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The largest car dealership in the US, AutoNation Inc. (NYSE: AN) reported earnings this morning for the first quarter. The company posted EPS of $0.56, an all-time high, on revenue of $3.7 billion. The consensus estimate called for EPS of $0.53 on revenue of $3.61 billion.

The company is taking advantage of the burst of new car sales in the first quarter. US sales have jumped to an annual rate of 14.5 million new cars. Total retail sales for all US auto dealerships rose 7% in the first quarter, while AutoNation’s sales of new cars rose 10%. Other national auto dealers, like America’s CarMart Inc. (NASDAQ: CRMT) and CarMax Inc. (NYSE: KMX) primarily sell used cars.

AutoNation’s unit sales in the first quarter rose 13% year-over-year, up 16% in domestic models, 6% in imports, and 14% in luxury models. The domestic category includes vehicles built by Ford Motor Co. (NYSE: F), General Motors Co. (NYSE: GM), and Chrysler. The import category includes vehicles from Toyota Motor Corp. (NYSE: TM), Honda Motor Corp. (NYSE: HMC), and Nissan Motor Corp. (OTC: NSANY.PK). Luxury models includes cars from Mercedes, BMW, and Toyota’s Lexus brand.

AutoNation could be positioned better going forward than its used car rivals CarMax and America’s CarMart, both of which attracted more cash-strapped buyers during the recession. But used car inventories are falling, prices are rising, and new car dealers are pricing their trade-ins more agressively.

AutoNation shares are up only 0.22% in pre-market trading this morning, at $33.65 in a 52-week range of $30.46-$41.55.

Paul Ausick

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About the Author Paul Ausick →

Paul Ausick has been writing for 247Wallst.com for more than a decade. He has written extensively on investing in the energy, defense, and technology sectors. In a previous life, he wrote technical documentation and managed a marketing communications group in Silicon Valley.

He has a bachelor's degree in English from the University of Chicago and now lives in Montana, where he fishes for trout in the summer and stays inside during the winter.

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