Yahoo Finance AutoNation, Inc. Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Predictions
Investors in AutoNation, Inc. (NYSE:AN) had a good week, as its shares rose 7.0% to close at US$165 following the release of its quarterly results. The result was positive overall - although revenues of US$6.5b were in line with what the analysts predicted, AutoNation surprised by delivering a statutory profit of US$4.49 per share, modestly greater than expected. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
Check out our latest analysis for AutoNation
Taking into account the latest results, AutoNation's ten analysts currently expect revenues in 2024 to be US$27.2b, approximately in line with the last 12 months. Statutory earnings per share are forecast to decline 19% to US$18.47 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$27.2b and earnings per share (EPS) of US$18.52 in 2024. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.
The analysts reconfirmed their price target of US$175, showing that the business is executing well and in line with expectations. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on AutoNation, with the most bullish analyst valuing it at US$215 and the most bearish at US$140 per share. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await AutoNation shareholders.
Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that AutoNation's revenue growth is expected to slow, with the forecast 0.7% annualised growth rate until the end of 2024 being well below the historical 6.9% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 4.9% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than AutoNation.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that AutoNation's revenue is expected to perform worse than the wider industry. The consensus price target held steady at US$175, with the latest estimates not enough to have an impact on their price targets.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for AutoNation going out to 2026, and you can see them free on our platform here.
However, before you get too enthused, we've discovered 3 warning signs for AutoNation (1 is a bit unpleasant!) that you should be aware of.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
