AutoNation: Lots to Look Forward to Down the Road [View article]
I do not agree that AutoNation is a good investment.
While AN's balance sheet shows shareholder equity to be approximately $2.1B, substract from that its stated Goodwill and other Intangible Assets of $1.3B and you have only $0.8B left to be allocated over 176.9M shares. This will give its shares a book value of only $4.52 per share, just over 40% of their current trading price.
Also, the company has no cash. It currently owes $2.1B in Accounts Payable, and yet shows combined Cash and Accounts Receivable of only $527.5M. That is a current shortfall of $1.57B...money that it does not have, with no indication that it can get.
In my opinion, this company is very near bankruptcy.
AutoNation: Lots to Look Forward to Down the Road [View article]
While AN's balance sheet shows shareholder equity to be approximately $2.1B, substract from that its stated Goodwill and other Intangible Assets of $1.3B and you have only $0.8B left to be allocated over 176.9M shares. This will give its shares a book value of only $4.52 per share, just over 40% of their current trading price.
Also, the company has no cash. It currently owes $2.1B in Accounts Payable, and yet shows combined Cash and Accounts Receivable of only $527.5M. That is a current shortfall of $1.57B...money that it does not have, with no indication that it can get.
In my opinion, this company is very near bankruptcy.