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AutoNation Inc AN Stock Quote

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Morningstar‘s Stock Analysis AN

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Share Repurchases a Big Part of AutoNation's Q3

Analyst Note

| David Whiston, CFA, CPA, CFE |

AutoNation’s third quarter saw adjusted diluted EPS rise year over year by 17.2% to $6.00 but still miss the Refinitiv consensus of $6.27. We are increasing our fair value estimate to $149 from $137 on the time value of money and from lowering our share count by about 10% to reflect large share repurchase activity this year that we expect to continue in 2023. Through the first nine months of 2022 the company repurchased 10.9 million shares for $1.2 billion and in the fourth quarter so far has repurchased another 2.7 million shares for about $287 million, which equates to 22% of the shares outstanding at the start of the year. The company announced a new $1 billion buyback authorization, which brings the total authorization to $1.4 billion.

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Company Profile AN

Business Description

AutoNation is the largest automotive dealer in the United States, with 2021 revenue of $25.8 billion and about 250 dealerships at nearly 350 locations, plus 56 collision centers. The firm also has 12 AutoNation USA used-vehicle stores, four auction sites, and three parts distributors all across 17 states primarily in Sunbelt metropolitan areas. New-vehicle sales account for about half of revenue; the company also sells used vehicles, parts, and repair services as well as auto financing. The company (formerly Republic Industries) spun off its waste management unit (Republic Services) in 1999 and its car rental businesses (ANC Rental) in 2000. Wayne Huizenga founded the company in the 1990s to bring the rollup acquisition strategy to auto retailing, which has proved to be a smart move.

Contact
200 SW 1st Avenue
Fort Lauderdale, FL, 33301
T +1 954 769-6000
Industry Auto & Truck Dealerships
Most Recent Earnings Sep 30, 2022
Fiscal Year End Dec 31, 2022
Employees 22,200

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