AutoNation (AN) Stock Forecast & Price Target

AutoNation reported a revenue projection of approximately $27 billion for 2024, underscoring its standing as the second-largest automotive dealer in the United States with a vast network of over 240 dealerships. The increase in premium luxury unit sales by 4.9% year-over-year, along with a 3.5% year-over-year increase in important unit sales, highlights the company's robust sales growth. Additionally, the notable rise in units acquired through Webuyyourcar.com, from 5-10% to approximately 33% over the past five years, indicates a successful expansion in its used vehicle acquisition strategy, further enhancing its revenue potential.

AutoNation is projected to experience a significant decline in earnings, with a fourth-quarter EBITDA estimate indicating a 12.9% year-over-year drop. Furthermore, the anticipated decrease in FY26 new gross profit per unit (GPUs) to $2,200, representing a $370 reduction from the prior year, signals ongoing challenges in profitability. The combination of these factors suggests that AutoNation's financial outlook is precarious, especially given that earnings estimates are notably lower than consensus expectations, creating a difficult environment for positive stock performance.