ABG

It has been about a month since the last earnings report for Asbury Automotive Group (ABG). Shares have lost about 15.5% in that time frame, underperforming the S&P 500. Will the recent negative trend continue leading up to its next earnings release, or is Asbury Automotive due for a breakout? Well, first let's take a quick look at the latest earnings report in order to get a better handle on the recent drivers for Asbury Automotive Group, Inc. before we dive into how investors and analysts have reacted as of late. Asbury reported second-quarter 2026 adjusted earnings of $6.82 per share, which declined 8.2% year over year but exceeded the Zacks Consensus Estimate of $6.30 by 8.25%. The bottom-line beat reflected stronger used-vehicle profitability despite weaker new-vehicle margins. Revenues of $4.38 billion rose 0.3% from the prior-year quarter but missed the consensus mark of $4.46 billion by 1.78%. New-vehicle revenues increased 1% year over year to $2.33 billion, while used retail revenues declined 3% to $1.09 billion. Wholesale used-vehicle revenues fell 9% to $141.9 million, leaving total used-vehicle revenues down 4% at $1.24 billion. Parts and service revenues advanced 6% to $634.6 million, while finance and insurance revenues edged up 1% to $183.8 million. The revenue mix shifted modestly toward parts and service, which represented 14.5% of total revenues compared with 13.8% a year earlier. New-vehicle unit sales were nearly flat at 44,245 units. Luxury and import sales increased 6% and 5%, respectively, but domestic unit sales declined 15%. The average new-vehicle selling price rose 2% to $52,666. Despite the pricing gain, new-vehicle gross profit fell 14% to $138.2 million as gross profit per unit declined 13% to $3,124. Used retail unit sales decreased 9% to 33,098, while the average selling price increased 6% to $33,054. Used retail gross profit rose 6% to $66.2 million, supported by the 16% improvement in gross profit per unit. Wholesale gross profit dropped 54% to $3.1 million. Parts and service gross profit increased 5% to $374.2 million, making it the company’s largest gross profit contributor. Finance and insurance gross profit rose 2% to $171.4 million, with gross profit per vehicle retailed increasing 6% to $2,216. Total gross profit was $753.1 million, essentially flat year over year, while gross margin remained at 17.2%. Same-store revenues declined 7% to $3.76 billion, while same-store gross profit decreased 7% to $643.2 million. New-vehicle unit sales fell 6% to 38,908, and used retail unit sales declined 14% to 28,821. Same-store new-vehicle gross profit per unit dropped 18% to $2,896. In contrast, used retail gross profit per unit increased 10% to $1,927, and finance and insurance gross profit per vehicle retailed rose 5% to $2,214. Same-store parts and service gross profit declined 1% to $322.8 million. Selling, general and administrative expenses rose 7% to $506.4 million. Adjusted SG&A increased 4% to $496.7 million and represented 66% of gross profit, compared with 63.6% in the year-ago quarter. Income from operations declined 15% to $219.5 million. Adjusted operating margin contracted to 5.3% from 5.8%, while adjusted EBITDA decreased to $234.8 million from $255.8 million. The results reflected higher expenses and weaker new-vehicle economics. The company generated $305.2 million of adjusted operating cash flow during the first half of 2026 and reported adjusted free cash flow of $188 million. It ended June with $966 million of liquidity and a transaction-adjusted net leverage ratio of 3.4 times. ABG repurchased about 668,000 shares for $131 million during the quarter. Year to date, it bought back roughly 1.35 million shares for $278 million, leaving approximately $322 million under its authorization. Asbury had converted 70% of its stores to the Tekion dealership management system as of July 28 and expects to complete the rollout in fall. Management noted stronger productivity, customer-pay performance, technician efficiency and sales effectiveness in markets that had used the platform for at least five months. In June, the Koons, Georgia and Florida stores increased average units per salesperson by 12% and dollars per technician by 10%. Management expects the platform to support better operating efficiency and is targeting same-store adjusted SG&A as a percentage of gross profit in the low-60% range by the end of 2027. In the past month, investors have witnessed a upward trend in estimates revision. The consensus estimate has shifted 5.13% due to these changes. Currently, Asbury Automotive has a nice Growth Score of B, though it is lagging a bit on the Momentum Score front with a C. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for value investors. Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in. Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Interestingly, Asbury Automotive has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Asbury Automotive Group, Inc. (ABG) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Management characterizes 2026 as a transition year centered on the nationwide rollout of the Tekion DMS, which has now surpassed the 70% implementation milestone. Performance drivers in mature Tekion markets (5+ months post-conversion) show double-digit productivity gains; specifically, in the month of June, these stores grew average units per salesperson by 12% and increased dollars per technician by 10%. New vehicle PVRs of $2.9 thousand on a same-store basis indicate flattening sequential declines, suggesting the market is nearing normalized levels. The company is pivoting its used vehicle strategy from a strict focus on gross profit preservation to driving higher volume while maintaining healthy PVRs, supported by a 37-day supply. Fixed operations saw a recovery in June with same-store gross profit up 4%, following initial productivity dips typical during the 5-6 month DMS adaptation window. Operational efficiency remains a core pillar, with management targeting a reduction in adjusted SG&A to the low 60% range by late 2027 through technology leverage and AI integration. New vehicle volume was impacted by a 28% decline in the Stellantis portfolio compared to the previous quarter. and a drop in import volume following the expiration of prior-year EV incentives. Management anticipates the completion of the Tekion rollout by October 2026, which is expected to unlock meaningful operating efficiencies across the entire store base. The company expects a return to normalized growth levels in parts and service in the coming quarters as more stores exit the initial 5-6 month DMS transition period. Used vehicle volume is projected to increase year-over-year starting in the fourth quarter of 2026 as the new volume-focused strategy matures. Capital allocation will remain balanced, with a current preference for share repurchases over M&A due to valuation dynamics, while targeting a 3.0x net leverage ratio by mid-2027. The effective tax rate is projected to be approximately 25% for the remainder of the year, with total CapEx spend anticipated at $250 million for 2026. The third quarter is expected to be a 'heavier lift' for the organization as it works to complete the final 30% of the technology rollout. Total Care Auto (TCA) generated a $0.66 per share non-cash deferral headwind in Q2, though the full-year impact is now expected to be less severe due to lower-than-anticipated sales volumes. Management noted a strategic decision to temporarily accept higher leverage (3.4x) to capitalize on share buyback opportunities at current valuations. Adjusted earnings exclude $4 million in Tekion implementation expenses and $1 million in duplicate DMS costs, which are expected to phase out post-rollout. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management explained that efficiency is driven by moving to a single ecosystem, eliminating the need for technicians and advisors to use multiple 'bolt-on' software logins. The unified platform improves 'time to market' for service recommendations, which increases the likelihood of guest approvals for additional repairs. The company is leveraging its franchise status to secure off-lease returns and retiring loaner vehicles, which offer better acquisition price points than auctions. Management is intentionally avoiding aggressive auction buying to prevent holding high-cost inventory during the typical valuation declines seen in September and October. Management stated it is currently difficult to justify acquisitions over share buybacks given the company's current stock valuation. While they continue to review M&A deals, the immediate priority is completing the Tekion rollout and improving same-store operations. EVs and PHEVs are currently generating approximately $350 more per repair order than internal combustion engine vehicles due to 'early stage' repairs on new technology. While revenue per order is higher, management expects margins to remain similar across vehicle types as the technology matures.

Asbury Automotive Group ABG reported second-quarter 2026 adjusted earnings of $6.82 per share, which declined 8.2% year over year but exceeded the Zacks Consensus Estimate of $6.30 by 8.25%. The bottom-line beat reflected stronger used-vehicle profitability despite weaker new-vehicle margins. Revenues of $4.38 billion rose 0.3% from the prior-year quarter but missed the consensus mark of $4.46 billion by 1.78%. Asbury Automotive Group, Inc. price-consensus-eps-surprise-chart | Asbury Automotive Group, Inc. Quote New-vehicle revenues increased 1% year over year to $2.33 billion, while used retail revenues declined 3% to $1.09 billion. Wholesale used-vehicle revenues fell 9% to $141.9 million, leaving total used-vehicle revenues down 4% at $1.24 billion. Parts and service revenues advanced 6% to $634.6 million, while finance and insurance revenues edged up 1% to $183.8 million. The revenue mix shifted modestly toward parts and service, which represented 14.5% of total revenues compared with 13.8% a year earlier. New-vehicle unit sales were nearly flat at 44,245 units. Luxury and import sales increased 6% and 5%, respectively, but domestic unit sales declined 15%. The average new-vehicle selling price rose 2% to $52,666. Despite the pricing gain, new-vehicle gross profit fell 14% to $138.2 million as gross profit per unit declined 13% to $3,124. Used retail unit sales decreased 9% to 33,098, while the average selling price increased 6% to $33,054. Used retail gross profit rose 6% to $66.2 million, supported by the 16% improvement in gross profit per unit. Wholesale gross profit dropped 54% to $3.1 million. Parts and service gross profit increased 5% to $374.2 million, making it the company’s largest gross profit contributor. Finance and insurance gross profit rose 2% to $171.4 million, with gross profit per vehicle retailed increasing 6% to $2,216. Total gross profit was $753.1 million, essentially flat year over year, while gross margin remained at 17.2%. Same-store revenues declined 7% to $3.76 billion, while same-store gross profit decreased 7% to $643.2 million. New-vehicle unit sales fell 6% to 38,908, and used retail unit sales declined 14% to 28,821. Same-store new-vehicle gross profit per unit dropped 18% to $2,896. In contrast, used retail gross profit per unit increased 10% to $1,927, and finance and insurance gross profit per vehicle retailed rose 5% to $2,214. Same-store parts and service gross profit declined 1% to $322.8 million. Selling, general and administrative expenses rose 7% to $506.4 million. Adjusted SG&A increased 4% to $496.7 million and represented 66% of gross profit, compared with 63.6% in the year-ago quarter. Income from operations declined 15% to $219.5 million. Adjusted operating margin contracted to 5.3% from 5.8%, while adjusted EBITDA decreased to $234.8 million from $255.8 million. The results reflected higher expenses and weaker new-vehicle economics. The company generated $305.2 million of adjusted operating cash flow during the first half of 2026 and reported adjusted free cash flow of $188 million. It ended June with $966 million of liquidity and a transaction-adjusted net leverage ratio of 3.4 times. ABG repurchased about 668,000 shares for $131 million during the quarter. Year to date, it bought back roughly 1.35 million shares for $278 million, leaving approximately $322 million under its authorization. Asbury currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Asbury had converted 70% of its stores to the Tekion dealership management system as of July 28 and expects to complete the rollout in fall. Management noted stronger productivity, customer-pay performance, technician efficiency and sales effectiveness in markets that had used the platform for at least five months. In June, the Koons, Georgia and Florida stores increased average units per salesperson by 12% and dollars per technician by 10%. Management expects the platform to support better operating efficiency and is targeting same-store adjusted SG&A as a percentage of gross profit in the low-60% range by the end of 2027. General Motors GM reported second-quarter 2026 adjusted earnings of $3.57 per share, up 41.3% year over year. The figure beat the Zacks Consensus Estimate of $3.13 by 14.06%. Revenues increased 1.9% to $48.03 billion and surpassed the consensus estimate of $46.56 billion by 3.15%. Strong pricing, lower costs and disciplined incentives supported results. General Motors raised its full-year adjusted EBIT guidance to $14-$16 billion from $13.5-$15.5 billion. Adjusted earnings are now projected at $12-$14 per share, up from the prior range of $11.50-$13.50. Tesla TSLA reported second-quarter 2026 adjusted earnings of 33 cents per share, which declined 17.5% year over year. The figure missed the Zacks Consensus Estimate of 50 cents by 34%. Revenues advanced 25.5% to $28.24 billion and surpassed the consensus estimate of $25.81 billion by 9.41%. Tesla expects 2026 capital expenditures to exceed $25 billion and rise further over the next two to three years. Genuine Parts GPC reported second-quarter 2026 adjusted earnings of $2.15 per share, beating the Zacks Consensus Estimate of $2.10 by 2.38%. The bottom line increased 2.4% from $2.10 in the year-ago quarter. Revenues rose 6% year over year to $6.54 billion and surpassed the consensus estimate of $6.39 billion by 2.36%. Genuine Parts reaffirmed its 2026 adjusted earnings guidance of $7.50-$8 per share and total sales growth outlook of 3-5.5%. Genuine Parts ended June with $2.3 billion of liquidity, including $559 million in cash. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Asbury Automotive Group, Inc. (ABG) : Free Stock Analysis Report Genuine Parts Company (GPC) : Free Stock Analysis Report General Motors Company (GM) : Free Stock Analysis Report Tesla, Inc. (TSLA) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Track your investments for FREE with Simply Wall St, the portfolio command center trusted by over 7 million individual investors worldwide. Asbury Automotive Group (ABG) just released its second quarter 2026 results, providing updated details on revenue, earnings and profitability as the company continues its Tekion system rollout and ongoing share repurchases. See our latest analysis for Asbury Automotive Group. Asbury Automotive Group shares have reacted strongly to the earnings beat and buyback update, with a 1-day share price return of 6.33% contributing to a 30-day share price return of 17.46%, while the 1-year total shareholder return of 9.38% points to more measured long term progress. If you are looking beyond Asbury Automotive Group for other ideas in the sector, this could be a good moment to review our screener of 18 top founder-led companies Bulls point to Asbury Automotive Group's earnings beat, solid margins and heavy buybacks. Bears focus on softer reported net income and revenue versus a year ago. Which side does the current valuation actually support next? The most followed valuation narrative for Asbury Automotive Group puts fair value at $235.67, slightly below the last close at $240.99. This frames the current debate on whether the latest earnings beat and buybacks still leave enough upside on the table. Read the complete narrative. Want to see what sits underneath that buyback and margin story? The narrative leans on measured revenue growth, firmer profitability and a future earnings multiple that stays below many retail peers. Result: Fair Value of $235.67 (OVERVALUED) Have a read of the narrative in full and understand what's behind the forecasts. However, Asbury Automotive Group still faces risks that could upset this story, including higher leverage from acquisitions and pressure from direct to consumer and digital first auto sales models. Find out about the key risks to this Asbury Automotive Group narrative. Analysts see Asbury Automotive Group as 2.3% overvalued against their $235.67 fair value, yet the stock trades on a P/E of 8.8x versus a fair ratio of 13.3x and a US Specialty Retail average of 20.6x. That gap suggests the market is pricing in meaningful valuation risk or opportunity. Which side do you think it is? See what the numbers say about this price — find out in our valuation breakdown. The mix of optimism and caution around Asbury Automotive Group is clear, so treat this as your prompt to check the data and move quickly to your own view using the summary of 3 key rewards and 1 important warning sign If Asbury Automotive Group has sharpened your focus on opportunities, now is a good time to broaden your watchlist using data driven stock ideas across sectors. Target companies that combine quality with attractive pricing by scanning a curated list of 49 high quality undervalued stocks that already clear key fundamental checks. Secure potential income streams by reviewing 8 dividend fortresses that focus on higher yielding stocks with an emphasis on consistency and financial resilience. Spot opportunities that others might overlook by running through a screener containing 20 high quality undiscovered gems built to highlight strong fundamentals before they hit the spotlight. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include ABG. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

Never miss an important update on your stock portfolio and cut through the noise. Over 7 million investors trust Simply Wall St to stay informed where it matters for FREE. Asbury Automotive Group stock has returned 21.6% over the past five years, and recent gains put the focus on whether the current price still lines up with what the valuation checks imply. Over five years, a 21.6% total return suggests the market has been rewarded for staying invested in Asbury Automotive Group. This now raises the question of how much value is already reflected in the share price. Stronger performance from the Parts and Service business can support profit resilience, while any slowdown in consumer spending on vehicle maintenance may weigh on how much investors are willing to pay for the stock. Asbury Automotive Group screens as undervalued in 5 of 6 checks, so the broader valuation work leans cheap for the stock, as reflected in a high value score here. The issue now is whether Asbury Automotive Group's current valuation still offers a clear margin between the stock price and what those checks suggest the business is worth. Asbury Automotive Group delivered 9.4% returns over the last year. See how this stacks up to the rest of the Specialty Retail industry. The P/E ratio suits Asbury Automotive Group because earnings are a key driver for established retailers. Right now the stock trades on a P/E of 8.8x, which is well below both the Specialty Retail industry average of 21.1x and the broader peer group average of 37.2x. That means investors are currently paying a lower price for each dollar of Asbury Automotive Group earnings compared with many similar companies. The fair P/E for Asbury Automotive Group based on its profile is estimated at 13.3x. This is higher than the current 8.8x multiple, so the stock is pricing in a sizeable discount to what that framework suggests could be reasonable. Despite the recent Q2 2026 earnings beat, with adjusted earnings per share above analyst expectations, the market multiple still sits below both the fair P/E and sector norms. On this earnings multiple, Asbury Automotive Group stock appears undervalued compared with both its tailored fair P/E and the wider Specialty Retail group. See what the numbers say about this price — find out in our valuation breakdown. Simply Wall St Narratives pick up where the valuation puzzle for Asbury Automotive Group stops. They spell out which combinations of future growth, margins and earnings would need to play out for the stock to be worth materially more or less than today's price on the numbers. Each narrative links its implied value to a specific view on how Asbury Automotive Group's growth, profitability and risks might evolve, which you can revisit as fresh information comes through on the Community page. One of the top community narratives on Asbury Automotive Group: 14% overvalued Read one of the top narratives on Asbury Automotive Group Do you think there's more to the story for Asbury Automotive Group? Head over to our Community to see what others are saying! Asbury Automotive Group still screens as undervalued on its earnings multiple, with the current P/E sitting well below both its tailored fair P/E and key peer averages. The broader valuation checks back up that market multiple signal, which keeps the current discount hard to ignore for value focused investors. The crux from here is whether earnings and the Parts and Service profit mix stay solid enough for that P/E gap to close, or whether structural risks from EV adoption and digital sales mean the stock continues to trade on a lower multiple. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include ABG. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

Asbury Automotive Group (ABG) came out with quarterly earnings of $6.82 per share, beating the Zacks Consensus Estimate of $6.3 per share. This compares to earnings of $7.43 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +8.25%. A quarter ago, it was expected that this auto dealership chain would post earnings of $5.68 per share when it actually produced earnings of $5.37, delivering a surprise of -5.46%. Over the last four quarters, the company has surpassed consensus EPS estimates two times. Asbury Automotive, which belongs to the Zacks Automotive - Retail and Whole Sales industry, posted revenues of $4.38 billion for the quarter ended June 2026, missing the Zacks Consensus Estimate by 1.78%. This compares to year-ago revenues of $4.37 billion. The company has topped consensus revenue estimates just once over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Asbury Automotive shares have lost about 2.5% since the beginning of the year versus the S&P 500's gain of 8.3%. While Asbury Automotive has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Asbury Automotive was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $6.72 on $4.65 billion in revenues for the coming quarter and $26.26 on $17.98 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Automotive - Retail and Whole Sales is currently in the bottom 24% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Penske Automotive (PAG), another stock in the same industry, has yet to report results for the quarter ended June 2026. The results are expected to be released on July 29. This auto dealership chain is expected to post quarterly earnings of $3.38 per share in its upcoming report, which represents a year-over-year change of -10.6%. The consensus EPS estimate for the quarter has been revised 0.2% lower over the last 30 days to the current level. Penske Automotive's revenues are expected to be $7.93 billion, up 3.4% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Asbury Automotive Group, Inc. (ABG) : Free Stock Analysis Report Penske Automotive Group, Inc. (PAG) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

This article first appeared on GuruFocus. Revenue: $4.4 billion for the second quarter. Gross Profit: $753 million with a gross profit margin of 17.2%. Adjusted Operating Margin: 5.3%. Adjusted Net Income: $125 million. Adjusted EBITDA: $235 million. Adjusted EPS: $6.82, with a potential $7.48 without noncash deferral impact. New Vehicle PVR: $3,896 on a same-store basis and $3,124 on an all-store basis. Used Retail PVR: $1,927, a sequential increase of 5%. F&I PVR: $2,214. Total Front-End Yield per Vehicle: $4,698. Same-Store Adjusted SG&A: 65.3% of gross profit. Adjusted SG&A (All-Store Basis): 66%, a 260 bps improvement over the first quarter. Adjusted Operating Cash Flow: $305 million year-to-date. Adjusted Free Cash Flow: $188 million through the end of June. Liquidity: $966 million at the end of the quarter. Transaction Adjusted Net Leverage Ratio: 3.4x at the end of the second quarter. Share Buybacks: 668,000 shares for $131 million in the quarter; 1.35 million shares for $278 million year-to-date. Warning! GuruFocus has detected 4 Warning Signs with ABG. Is ABG fairly valued? Test your thesis with our free DCF calculator. Release Date: July 28, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Asbury Automotive Group Inc (NYSE:ABG) has successfully implemented Tekion across 70% of its store base, leading to improved operational efficiencies. The company reported a sequential increase in used retail PVR by 5%, indicating a positive impact from its used vehicle strategy. ABG has repurchased 7% of its 2025 ending share count, reflecting confidence in its stock as a long-term investment. The company achieved a gross profit margin of 17.2% and an adjusted operating margin of 5.3% for the second quarter. ABG's strategic initiatives, including increasing new vehicle market share and leveraging technology, are focused on driving growth and returns for shareholders. New vehicle units were down 6% on a same-store basis, indicating challenges in the new vehicle market. The company is still experiencing frictional costs associated with the Tekion rollout, impacting short-term financial performance. Parts and service gross profit was slightly down year-over-year, with customer pay business remaining flat. The transition to Tekion has led to temporary inefficiencies, particularly in fixed operations, affecting short-term results. ABG's adjusted SG&A as a percentage of gross profit was 66%, indicating room for improvement in cost management. Q: Can you discuss the changes from Q1 to Q2, particularly regarding the negative 6% same-store new vehicle sales? A: Michael Welch, CFO, noted that Q1 was affected by weather, making Q2 a more normal quarter. There was a slight decline in new vehicle PVR, but it remains within expectations. SG&A improved due to higher gross profits and efficiencies from stores in the Tekion transition. CEO Dan Clara added that the 6% decline in new car sales was partly due to Tekion system adaptation and market conditions, including a significant drop in Salento store sales and changes in import volumes. Q: How is the used vehicle strategy evolving, and what impact does it have on volumes and GPUs? A: Dan Clara explained that the strategy is shifting from maximizing gross profit to increasing volume while maintaining healthy PVRs. This approach is methodical to avoid negative impacts from market fluctuations, such as those expected in September. The company is strategically acquiring inventory, including from auctions, and expects to see increased used vehicle volume by Q4 2026. Q: Can you provide insights into the SG&A improvements in stores using Tekion, particularly in Koons and Florida? A: Michael Welch stated that Koons stores have been on Tekion for about a year, while Atlanta and Florida stores are just reaching the 5-6 month mark. SG&A is expected to decline steadily each quarter, reaching the low 60% range by the end of 2027. Dan Clara added that Koons stores have seen a 14.2% increase in units per sales manager and a 15.2% increase in units per F&I manager, indicating improved efficiencies. Q: What are your expectations for Parts & Services growth, considering recent trends and potential consumer behavior changes? A: Dan Clara mentioned that June saw a 4% growth in Parts & Services, and July is showing similar trends. The company expects low to mid-single-digit growth in customer pay. While there are some pressures on consumer affordability, Asbury has not seen significant impacts on service operations. The focus is on providing value and enhancing customer retention. Q: How is the Tekion rollout progressing, and what efficiencies are being realized? A: Michael Welch explained that the rollout is on track, with 70% of stores converted. The temporary slowdown in May was strategic to support the Herb Chambers group. Dan Clara highlighted that Tekion's unified ecosystem improves technician efficiency and customer experience, leading to higher dollars per technician and faster service approvals. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

For the quarter ended June 2026, Asbury Automotive Group (ABG) reported revenue of $4.38 billion, up 0.3% over the same period last year. EPS came in at $6.82, compared to $7.43 in the year-ago quarter. The reported revenue represents a surprise of -1.78% over the Zacks Consensus Estimate of $4.46 billion. With the consensus EPS estimate being $6.30, the EPS surprise was +8.25%. While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Street expectations to determine their next course of action, some key metrics always provide a better insight into a company's underlying performance. As these metrics influence top- and bottom-line performance, comparing them to the year-ago numbers and what analysts estimated helps investors project a stock's price performance more accurately. Here is how Asbury Automotive performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts: Unit sales - New vehicle: 44,245 compared to the 43,436 average estimate based on two analysts. Unit sales - Used vehicle retail: 33,098 versus the two-analyst average estimate of 34,389. Average selling price - New vehicle: $52.67 billion versus the two-analyst average estimate of $52.49 billion. Unit sales - Used vehicle retail - same store: 28,821 compared to the 33,068 average estimate based on two analysts. Average Gross profit per unit - Total new vehicle: $3.12 billion compared to the $3.11 billion average estimate based on two analysts. Average Gross profit per unit - Used vehicle retail: $2 billion versus $1.86 billion estimated by two analysts on average. Revenues- New vehicle: $2.33 billion compared to the $2.36 billion average estimate based on three analysts. The reported number represents a change of +1.1% year over year. Revenues- Used vehicle: $1.24 billion versus $1.27 billion estimated by three analysts on average. Compared to the year-ago quarter, this number represents a -3.9% change. Revenues- Used vehicle- Wholesale: $141.9 million versus the three-analyst average estimate of $153.24 million. The reported number represents a year-over-year change of -9.2%. Revenues- Finance and insurance net: $183.8 million versus the three-analyst average estimate of $175.36 million. The reported number represents a year-over-year change of +1%. Revenues- Used vehicle- Retail: $1.09 billion versus $1.12 billion estimated by three analysts on average. Compared to the year-ago quarter, this number represents a -3.1% change. Revenues- Parts and service: $634.6 million compared to the $652.82 million average estimate based on three analysts. The reported number represents a change of +5.5% year over year. View all Key Company Metrics for Asbury Automotive here>>> Shares of Asbury Automotive have returned +12.5% over the past month versus the Zacks S&P 500 composite's +1.7% change. The stock currently has a Zacks Rank #3 (Hold), indicating that it could perform in line with the broader market in the near term. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Asbury Automotive Group, Inc. (ABG) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Interested in Asbury Automotive Group, Inc.? Here are five stocks we like better. Asbury reported solid Q2 results, including $4.4 billion in revenue, $6.82 in adjusted EPS and $235 million in adjusted EBITDA. EPS would have been $7.48 excluding a $0.66-per-share non-cash deferral headwind from Total Care Auto. The Tekion rollout has exceeded 70% completion and is expected to finish by October. Early-converted markets are showing productivity gains, though implementation costs and temporary sales disruption are weighing on near-term results. Asbury is targeting used-vehicle volume growth and lower costs, aiming to reduce SG&A to the low-60% range of gross profit by the end of 2027. The company repurchased $131 million of shares in Q2 and expects leverage to return to 3.0 times by early to mid-2027. Asbury Automotive Group (NYSE:ABG) reported second-quarter 2026 adjusted earnings per share of $6.82, as the dealership operator continued its transition to the Tekion dealership-management system and emphasized operational improvements, used-vehicle volume growth and share repurchases. The company generated $4.4 billion in revenue, $753 million in gross profit and a 17.2% gross-profit margin during the quarter. Adjusted operating margin was 5.3%, while adjusted EBITDA totaled $235 million and adjusted net income was $125 million, Chief Financial Officer Michael Welch said. → Volatility Is Back and These 3 Market Tollbooths Are Best Positioned to Profit Welch said the quarter’s adjusted results excluded $4 million of net tax related to Tekion implementation expenses, $3 million of non-cash asset impairments, $2 million of weather-related losses and $1 million of duplicate dealership-management-system expenses. He also said Total Care Auto, or TCA, created a non-cash deferral headwind of $0.66 per share; excluding that impact, adjusted EPS would have been $7.48. President and Chief Executive Officer Dan Clara, speaking on his first earnings call as CEO, described 2026 as a transition year as Asbury completes the Tekion rollout across its stores. The company expects to finish the conversion by October, with about 30% of its store base remaining as of the call. → This Tiny AI Supplier Could Be More Important Than the Chipmakers Clara said the conversion requires investment because Asbury is operating legacy systems while installing the new platform, but management expects the common system to produce efficiencies once stores have had time to adapt. Stores generally require five to six months after conversion before the company sees more significant operational benefits, he said. In markets that have been on Tekion for at least five months, including Koons, Georgia and Florida, average units per salesperson increased 12% in June and dollars per technician rose 10%, Clara said. He later added that the Koons operations posted a 14.2% sequential increase in units per sales manager and a 15.2% increase in units per finance-and-insurance manager. → 2 Stocks Built to Thrive If Inflation Refuses to Fade Management said Tekion helps reduce the need for technicians and service advisers to switch among multiple systems. The platform consolidates communications among advisers, technicians and parts departments, while also enabling faster delivery of photos and videos to customers regarding recommended work. Welch said the company transitioned 13 stores in July and expects the third quarter to be a relatively heavy implementation period. Asbury intentionally slowed conversions in May after rolling out Herb Chambers operations in March and April, he said, because the acquired group was also adapting to the company’s standard processes and shared-service center. On a same-store basis, new-vehicle unit sales declined 6% in the quarter. New-vehicle profit per retail unit, or PVR, was $2,896 on a same-store basis and $3,124 on an all-store basis. Asbury ended the period with a 53-day new-vehicle supply. Clara said the company saw a temporary sales disruption at stores converting to Tekion as sales staff adapted to the new system’s workflow for internet leads and follow-up, though recovery has been faster than in fixed operations. He also cited a 28% decline at Stellantis stores, as well as lower volumes at some import dealerships following the prior-year demand for electric vehicles before incentives expired. Luxury new-vehicle volume declined 10%, imports were flat and domestic volume fell 16%, according to Clara. He said inventory is improving at luxury manufacturers and that Toyota’s supply of roughly 12 to 15 days supports healthy margins. Used-vehicle retail PVR was $1,927, up 5% sequentially, while used-vehicle volume was effectively flat from the first quarter. Used-vehicle supply ended the quarter at 37 days, compared with 30 days previously, after the company purchased approximately 6,500 vehicles at auction during the quarter. Management said it began shifting its used-car strategy in May toward higher volume while maintaining what it considers healthy PVRs. Clara expects year-over-year used-vehicle volume growth to begin in the fourth quarter. The company is seeking inventory through consumer purchases, off-lease vehicles, loaner fleets and selective auction purchases, while emphasizing the advantages of franchise dealerships in sourcing and certifying vehicles. Customer-pay parts and service business was flat year over year, and total fixed-operations gross profit was slightly lower. However, total same-store fixed gross profit increased 4% in June, and Clara said July trends were similar. The company expects low- to mid-single-digit customer-pay growth in the third quarter. Same-store adjusted selling, general and administrative expense was 65.3% of gross profit, while the all-store figure was 66%, a 260-basis-point improvement from the first quarter. Welch said Asbury expects gradual quarterly improvement despite continued rollout costs and sees a path to begin realizing savings late in 2026 and into 2027. Clara said the company aims to reduce SG&A to the low-60% range of gross profit by the end of 2027 after the Tekion conversion is complete and efficiencies are realized. Asbury is also investing in artificial intelligence applications across operations and support functions, he said. Year-to-date adjusted operating cash flow was $305 million, and adjusted free cash flow totaled $188 million through June. Excluding real-estate purchases, capital expenditures were $117 million in the first half, with full-year capital spending still expected to be about $250 million. Liquidity at quarter-end was $966 million, excluding cash at TotalCare Auto. Transaction-adjusted net leverage was 3.4 times. Asbury repurchased 668,000 shares for $131 million in the second quarter. Year-to-date repurchases totaled 1.35 million shares for $278 million, equal to 7% of the company’s year-end 2025 share count. Welch said Asbury temporarily accepted higher leverage because management viewed the company’s shares as attractively valued. The company continues to target leverage of 3.0 times and expects to reach that level in early to mid-2027. Management said it continues to review acquisition opportunities but currently views share repurchases as offering a better return than the deals it has recently evaluated. Asbury Automotive Group, Inc (NYSE:ABG) is one of the largest automotive retailers in the United States. Headquartered in Duluth, Georgia, the company operates a network of franchised dealerships representing a diverse portfolio of automotive brands. Its core business activities include the sale of new and pre-owned vehicles, as well as the provision of vehicle finance, insurance and protection products to retail customers. In addition to retail sales, Asbury offers a comprehensive suite of after-sales services, from scheduled maintenance and certified collision repair to parts distribution. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Asbury Automotive Group Q2 Earnings Call Highlights" was originally published by MarketBeat. 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