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For new and old investors, taking full advantage of the stock market and investing with confidence are common goals.
While you may have an investing style you rely on, finding great stocks is made easier with the Zacks Style Scores. These are complementary indicators that rate stocks based on value, growth, and/or momentum characteristics.
Why Investors Should Pay Attention to This Value Stock
Different than growth or momentum investors, value-focused investors are all about finding good stocks at good prices, and discovering which companies are trading under what their true value is before the broader market catches on. The Value Style Score utilizes ratios like P/E, PEG, Price/Sales, and Price/Cash Flow to help pick out the most attractive and discounted stocks.
Sonic Automotive (SAH)
Sonic Automotive is one of the leading automotive retailers in the United States. Apart from selling new and used cars and light trucks, the company offers warranties, service contracts, vehicle financing and insurance. Further, it provides maintenance and repair services, and sells replacement parts and aftermarket automotive products. Each sale of a new or used vehicle comes with financing and insurance options and helps the firm earn financing fees and insurance and other aftermarket product commissions. Each of the company’s franchised dealerships include a fully integrated service and parts department.
SAH is a Zacks Rank #3 (Hold) stock, with a Value Style Score of B and VGM Score of B. Shares are currently trading at a forward P/E of 10.6X for the current fiscal year compared to the Automotive - Retail and Whole Sales industry's P/E of 10.7X. Additionally, SAH has a PEG Ratio of 0.6 and a Price/Cash Flow ratio of 6.9X. Value investors should also note SAH's Price/Sales ratio of 0.2X.
A company's earnings performance is important for value investors as well. For fiscal 2025, three analysts revised their earnings estimate higher in the last 60 days for SAH, while the Zacks Consensus Estimate has increased $0.17 to $6.30 per share. SAH also holds an average earnings surprise of 2.1%.
With strong valuation and earnings metrics, a good Zacks Rank, and top-tier Value and VGM Style Scores, investors should strongly think about adding SAH to their portfolios.
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Sonic Automotive, Inc. (SAH) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).