AutoNation Second Quarter Earnings Sneak Peek

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S&P 500 (NYSE:SPY) component AutoNation (NYSE:AN) will unveil its latest earnings on Thursday, July 19, 2012. AutoNation offers a range of automotive products and services, including new and used vehicles, parts and automotive repair, and maintenance services, as well as automotive finance and insurance products.

AutoNation Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average analyst estimate is for net income of 59 cents per share, a rise of 20.4% from the company’s actual earnings for the year-ago quarter. During the past three months, the average estimate has moved up from 56 cents. Between one and three months ago, the average estimate moved up. It has been unchanged at 59 cents during the last month. Analysts are projecting profit to rise by 20.6% versus last year to $2.34.

Past Earnings Performance: The company is looking to beat analyst estimates for the third quarter in a row. Last quarter, it beat estimates with profit of 56 cents per share against the mean estimate of 53 cents. In the prior quarter, the company reported net income of 51 cents.

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Stock Price Performance: Between April 18, 2012 and July 13, 2012, the stock price rose $6.09 (18%), from $33.75 to $39.84. The stock price saw one of its best stretches over the last year between May 17, 2012 and May 29, 2012, when shares rose for eight straight days, increasing 7.1% (+$2.43) over that span. It saw one of its worst periods between February 7, 2012 and February 15, 2012 when shares fell for seven straight days, dropping 7.1% (-$2.63) over that span.

Wall St. Revenue Expectations: Analysts are projecting a rise of 11.4% in revenue from the year-earlier quarter to $3.72 billion.

A Look Back: In the first quarter, profit rose 5.2% to $73 million (55 cents a share) from $69.4 million (46 cents a share) the year earlier, exceeding analyst expectations. Revenue rose 10.4% to $3.66 billion from $3.31 billion.

Key Stats:

After experiencing income increases the last three quarters, the company is hoping to keep the good news coming with this earnings announcement. Net income rose 24.3% in the third quarter of the last fiscal year and 3.1% in the fourth quarter of the last fiscal year before increasing again in the first quarter.

On the top line, the company is looking to build on four-straight revenue increases heading into this earnings announcement. Revenue rose 6.9% in the second quarter of the last fiscal year, 6.7% in the third quarter of the last fiscal year and 14.6% in the fourth quarter of the last fiscal year before increasing again in the first quarter.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 1.05 last quarter. The current ratio is an indication of a firm’s liquidity and ability to meet creditor demands and generally, for every dollar the company owes in the short term, it has that figure available in assets that can be converted to cash in the short term. The company regressed in this liquidity measure from 1.09 in the fourth quarter of the last fiscal year to the last quarter driven in part by an increase in liabilities. Current liabilities increased 8.1% to $2.66 billion while assets rose 3.9% to $2.78 billion.

Analyst Ratings: There are mostly holds on the stock with 10 of 12 analysts surveyed giving that rating.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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