AutoNation's first-quarter 2026 adjusted diluted earnings per share of $4.69 was up only a penny year over year, with same-store revenue down 3.7% on an 8.9% fall in new vehicle revenue. Same-store service sales rose 3.7%, and that segment posted a record gross profit.
AutoNation's massive size provides some appealing economies of scale, illustrated by strong operating margins.
Bears
About half of revenue is derived from new-car sales, leaving AutoNation vulnerable to the fluctuations of a viciously cyclical industry. This risk is greater for AutoNation as it gets a much larger share of its sales from California and Florida than the national average. These markets could be hit worse than other US markets in a housing downturn or by hurricanes.
AutoNation is the second-largest automotive dealer in the United States, with 2025 revenue of $27.6 billion and over 240 dealerships, plus 52 collision centers. The firm also has 25 AutoNation USA used-vehicle stores, a captive lender, four auction sites, and three parts distributors across 20 states primarily in Sunbelt metropolitan areas. New-vehicle sales account for nearly half of revenue; the company also sells used vehicles, parts, and repair services as well as auto financing. The company (formerly Republic Industries) divested 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 proved to be a smart move.