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Sonic Automotive Inc
SAH : NYSE : Services
$24.72 up0.19 | 0.77%
Today's Range: 24.41 - 24.87
Avg. Daily Volume: 269,000
11/25/15 - 4:02 PM ET

Financial Analysis

SONIC AUTOMOTIVE INC's gross profit margin for the third quarter of its fiscal year 2015 is essentially unchanged when compared to the same period a year ago. Sales and net income have grown, and although the growth in revenues has outpaced the average competitor within the industry, the net income growth has not. SONIC AUTOMOTIVE INC has very weak liquidity. Currently, the Quick Ratio is 0.18 which clearly shows a lack of ability to cover short-term cash needs. The company's liquidity decreased from the same period a year ago, despite already having very weak liquidity to begin with. This would indicate deteriorating cash flow.

During the same period, stockholders' equity ("net worth") has increased by 6.05% from the same quarter last year. The key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the near future.

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Income Statement Q3 FY15 Q3 FY14
Net Sales ($mil)2494.412355.61
EBITDA ($mil)78.9773.14
EBIT ($mil)61.7258.9
Net Income ($mil)26.524.71

Balance Sheet Q3 FY15 Q3 FY14
Cash & Equiv. ($mil)2.491.66
Total Assets ($mil)3292.412983.91
Total Debt ($mil)2111.541876.85
Equity ($mil)693.16653.57

Profitability Q3 FY15 Q3 FY14
Gross Profit Margin14.4414.5
EBITDA Margin3.163.1
Operating Margin2.472.5
Sales Turnover2.893.07
Return on Assets2.473.32
Return on Equity12.0515.47
Debt Q3 FY15 Q3 FY14
Current Ratio1.11.13
Interest Expense18.3817.8
Interest Coverage3.363.31

Share Data Q3 FY15 Q3 FY14
Shares outstanding (mil)49.9351.47
Div / share0.030.03
Book value / share13.8812.7
Institutional Own % n/a n/a
Avg Daily Volume275888.0315053.0


BUY. The current P/E ratio indicates a significant discount compared to an average of 26.12 for the Specialty Retail industry and a discount compared to the S&P 500 average of 21.93. To use another comparison, its price-to-book ratio of 1.74 indicates a discount versus the S&P 500 average of 2.77 and a significant discount versus the industry average of 10.85. The price-to-sales ratio is well below both the S&P 500 average and the industry average, indicating a discount. Upon assessment of these and other key valuation criteria, SONIC AUTOMOTIVE INC proves to trade at a discount to investment alternatives within the industry.

1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
SAH 14.82 Peers 26.12   SAH 8.74 Peers 16.47

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

SAH is trading at a significant discount to its peers.


Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

SAH is trading at a significant discount to its peers.

1 2 3 4 5
premium   discount
  Price to
1 2 3 4 5
premium   discount
SAH 10.86 Peers 21.04   SAH 3.26 Peers 1.97

Discount. A lower price-to-projected earnings ratio than its peers can signify a less expensive stock or lower future growth expectations.

SAH is trading at a significant discount to its peers.


Premium. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

SAH trades at a significant premium to its peers.

1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
SAH 1.74 Peers 10.85   SAH -14.66 Peers 72.16

Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

SAH is trading at a significant discount to its peers.


Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, SAH is expected to significantly trail its peers on the basis of its earnings growth rate.

1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
SAH 0.13 Peers 1.57   SAH 3.76 Peers 6.49

Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

SAH is trading at a significant discount to its industry on this measurement.


Lower. A sales growth rate that trails the industry implies that a company is losing market share.

SAH significantly trails its peers on the basis of sales growth



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