Earnings Preview: AutoNation

AutoNation (AN) is expected to report Q3 earnings before market open Thursday, Novembe 6, with a conference call scheduled for 11:00 am ET.

Guidance

Analysts are looking for a profit of 29c on revenue of $3.88B. The consensus is 25c to 32c for EPS, and revenue of $3.71B to $4.09B, according to First Call. For Q2, AutoNation reported EPS 33c vs. consensus of 30c and revenue $3.91B vs. consensus of $4.09B. Difficult borrowing conditions and a poor economy are negative trends that will most likely hurt AutoNation's sales this quarter. Continued weakness in California and Florida housing is especially problematic for the company.

Analyst Views

On September 25, Kevin Dann maintained a Neutral rating on AutoNation and raised its price target to $14 from $11. Kevin Dann believes expectations for prolonged sales and earnings challenges are well-priced into shares at current levels, but feels if the stock rises to the $15-$16 level on the government bail-out, profit taking is prudent.