Sonic Automotive (NYSE:SAH) Shares Down 8% – Should You Sell?

Sonic Automotive, Inc. (NYSE:SAH)’s stock price traded down 8% on Friday . The company traded as low as $91.96 and last traded at $92.28. 30,431 shares were traded during trading, a decline of 89% from the average daily volume of 276,958 shares. The stock had previously closed at $100.34.

Key Stories Impacting Sonic Automotive

Here are the key news stories impacting Sonic Automotive this week:

• Positive Sentiment: Needham & Company raised its price target on Sonic Automotive from $90 to $139 and upgraded the stock to “Buy,” implying significant upside from recent levels. Benzinga
• Positive Sentiment: Second-quarter revenue rose 7.6% year over year to approximately $3.93 billion, exceeding the $3.78 billion analyst estimate. Adjusted earnings of $1.82 per share also beat expectations of $1.75, while total gross profit reached a quarterly record of $616.2 million. Sonic Automotive Reports Second Quarter 2026 Financial Results
• Neutral Sentiment: Sonic Automotive declared a quarterly dividend of $0.41 per share, payable October 15 to shareholders of record on September 15. The dividend represents an annualized yield of approximately 1.6%, offering some shareholder-return support but likely having limited near-term impact on the stock.
• Negative Sentiment: Quarterly EPS declined from $2.19 in the prior-year period to $1.82, and reported net margin was only 0.72%. Coverage indicates that higher dealership costs undermined profitability, tempering the market’s reaction to the revenue and earnings beats. Sonic Automotive shares turn negative as profitability undermined by dealership costs

Analysts Set New Price Targets

A number of brokerages have recently commented on SAH. Morgan Stanley set a $72.00 target price on shares of Sonic Automotive in a report on Thursday, May 7th. JPMorgan Chase & Co. lowered their price target on Sonic Automotive from $77.00 to $76.00 and set an “underweight” rating on the stock in a report on Monday, July 13th. Zacks Research raised Sonic Automotive from a “strong sell” rating to a “hold” rating in a research note on Tuesday, April 28th. UBS Group increased their price objective on Sonic Automotive from $90.00 to $109.00 and gave the stock a “buy” rating in a research report on Friday, July 10th. Finally, Seaport Research Partners downgraded Sonic Automotive from a “buy” rating to a “neutral” rating and lifted their target price for the company from $185.00 to $205.00 in a research note on Friday, July 17th. Five investment analysts have rated the stock with a Buy rating, five have issued a Hold rating and one has issued a Sell rating to the company. Based on data from MarketBeat.com, Sonic Automotive presently has an average rating of “Hold” and an average price target of $96.11.

Sonic Automotive Stock Performance

The company has a current ratio of 1.03, a quick ratio of 0.29 and a debt-to-equity ratio of 1.93. The firm has a market capitalization of $2.88 billion, a price-to-earnings ratio of 28.97, a PEG ratio of 1.72 and a beta of 0.89. The stock’s 50 day moving average price is $88.28 and its two-hundred day moving average price is $73.83.

Sonic Automotive (NYSE:SAH) last announced its quarterly earnings results on Thursday, July 30th. The company reported $1.82 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $1.75 by $0.07. Sonic Automotive had a net margin of 0.72% and a return on equity of 22.45%. The business had revenue of $3.93 billion during the quarter, compared to the consensus estimate of $3.78 billion. During the same quarter last year, the firm posted $2.19 EPS. The business’s revenue was up 7.6% compared to the same quarter last year. On average, analysts forecast that Sonic Automotive, Inc. will post 6.93 EPS for the current year.

Sonic Automotive Dividend Announcement

The business also recently announced a quarterly dividend, which will be paid on Thursday, October 15th. Shareholders of record on Tuesday, September 15th will be issued a $0.41 dividend. The ex-dividend date of this dividend is Tuesday, September 15th. This represents a $1.64 dividend on an annualized basis and a yield of 1.8%. Sonic Automotive’s dividend payout ratio (DPR) is 52.23%.

Insider Transactions at Sonic Automotive

In other news, President Jeff Dyke sold 50,000 shares of Sonic Automotive stock in a transaction that occurred on Monday, June 8th. The shares were sold at an average price of $82.97, for a total transaction of $4,148,500.00. Following the completion of the sale, the president directly owned 111,622 shares in the company, valued at approximately $9,261,277.34. This trade represents a 30.94% decrease in their position. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is accessible through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold 100,000 shares of company stock valued at $8,408,160 over the last three months. Company insiders own 43.68% of the company’s stock.

Institutional Investors Weigh In On Sonic Automotive

A number of institutional investors and hedge funds have recently modified their holdings of SAH. Dimensional Fund Advisors LP increased its stake in Sonic Automotive by 3.8% in the 1st quarter. Dimensional Fund Advisors LP now owns 1,313,857 shares of the company’s stock valued at $90,088,000 after purchasing an additional 48,599 shares in the last quarter. State Street Corp raised its holdings in Sonic Automotive by 9.8% during the fourth quarter. State Street Corp now owns 701,133 shares of the company’s stock worth $43,623,000 after purchasing an additional 62,426 shares during the last quarter. Invesco Ltd. boosted its position in Sonic Automotive by 11.9% during the fourth quarter. Invesco Ltd. now owns 510,963 shares of the company’s stock worth $31,608,000 after purchasing an additional 54,455 shares in the last quarter. Millennium Management LLC boosted its position in Sonic Automotive by 20.5% during the third quarter. Millennium Management LLC now owns 383,117 shares of the company’s stock worth $29,151,000 after purchasing an additional 65,266 shares in the last quarter. Finally, Geode Capital Management LLC grew its holdings in Sonic Automotive by 1.2% in the fourth quarter. Geode Capital Management LLC now owns 375,034 shares of the company’s stock valued at $23,204,000 after purchasing an additional 4,443 shares during the last quarter. Institutional investors and hedge funds own 46.92% of the company’s stock.

Sonic Automotive Company Profile

Sonic Automotive, Inc is a publicly traded automotive retailer that operates a network of franchised new-car dealerships and used-vehicle dealerships across the United States. Headquartered in Charlotte, North Carolina, the company offers a range of services that include vehicle sales, leasing, finance and insurance products, service and parts, and collision repair. Sonic Automotive’s dealerships represent numerous major automotive brands, and the company also markets a broad selection of pre-owned vehicles under its own banner.

In addition to its core dealership operations, Sonic Automotive has developed digital retail capabilities that allow customers to research, shop and complete transactions online.