AutoNation (AN) Stock Forecast & Price Target

AutoNation, the second-largest automotive dealer in the U.S., is projected to achieve approximately $27 billion in revenue for 2024, with nearly half of its revenue stemming from new-vehicle sales. The company has demonstrated strong growth in premium luxury unit sales, which increased by 4.9% year-over-year, alongside 3.5% year-over-year growth in import unit sales. Additionally, the rising contribution of Webuyyourcar.com to acquired units, increasing from 5% to 33% over the past five years, reflects AutoNation's effective capital allocation and strategic focus on enhancing its used-vehicle acquisition capabilities.

AutoNation is projected to experience a significant 12.9% year-over-year decline in EBITDA for 4Q25, reflecting deteriorating financial performance. Additionally, anticipated reductions in gross profit per unit for new vehicles to $2,200 in FY26, down $370 year-over-year, further complicate the company’s profitability outlook. Given these factors and the forecasts that earnings estimates are substantially below consensus, there are concerns regarding the stock's valuation and overall market appeal.