Jeff Lick • Stephens Inc.

Answer

CEO Peter Kelly confirmed that the 'win back' customer onboarding is on track for a launch around the end of the year, which would be a positive factor for 2026 commercial volumes. CFO Brad Herring addressed the preferred stock, noting it is on the company's radar as it comes due in June 2026. While not providing a specific plan, he emphasized that the company's clean balance sheet and strong cash generation provide multiple options for addressing it.

Ask Fintool Equity Research AI

Answer

CEO John Hazen confirmed the historical margin spread is about 1,000 basis points. He explained that the company is running a large-scale elasticity test precisely because they don't know how customers will react to the widening price gap. He also stated that no third-party vendors have rescinded their announced price increases.

Ask Fintool Equity Research AI

Answer

CEO Ernie Garcia emphasized focusing on overall results rather than short-term lever adjustments. CFO Mark Jenkins attributed their financing success to the vertically integrated platform, which provides deep knowledge of both the vehicle and the customer, enhanced by sophisticated data modeling to manage risk effectively.

Ask Fintool Equity Research AI

Answer

CEO Ernie Garcia noted that the company focuses on optimizing its vertically integrated machine for overall results rather than specific quarterly lever adjustments. CFO Mark Jenkins attributed the strong finance performance to the advantages of their vertically integrated model, which includes intimately knowing both the vehicle and the customer, and leveraging growing data sets to continuously improve their underwriting models.

Ask Fintool Equity Research AI

Answer

COO of North American Operations Richard Shearing confirmed that while some large recalls are being lapped, new ones, like for the Toyota Tundra, are emerging. He stressed that the segment's strength is driven by an aging vehicle fleet and internal efficiency gains. Chairman & CEO Roger Penske highlighted that increasing vehicle complexity drives customers to dealerships. EVP of IR & Corporate Development Anthony Pordon also noted that the use of AI and technology is improving service department efficiency and utilization.

Ask Fintool Equity Research AI

Answer

Chief Operating Officer Daniel Clara explained that new vehicle GPUs were strong early in the quarter but moderated as the SAAR leveled off. He confirmed the company's belief that GPUs will normalize in the $2,500 to $3,000 range, a forecast that attempts to account for potential pricing adjustments, though the situation remains fluid. He also agreed that major OEM adjustments are most likely to coincide with the 2026 model year.

Ask Fintool Equity Research AI

Answer

President & CEO Bryan DeBoer explained that the company is diversified, with less than 20% of net profit from new vehicle sales, making it adaptable to tariffs through levers like vehicle de-contenting and financing. Regarding Chinese OEMs, he noted Lithia has five such franchises in the UK, providing firsthand insight, but stated their U.S. entry remains uncertain given high tariffs and past failed attempts.

Ask Fintool Equity Research AI

Answer

CFO Thomas Szlosek attributed the SG&A improvement to disciplined marketing spend, variable compensation, and specific cost-saving initiatives like standardized HVAC systems and LED lighting. He also described AutoNation Finance as highly integrated, helping to drive superior outcomes in areas like CFS product attachment. CEO Michael Manley added that the finance arm operates with a competitive mindset, earning its business through superior service levels to the dealerships, which is a cornerstone of its culture.

Ask Fintool Equity Research AI

Answer

CEO Daryl Kenningham highlighted the strong aftersales performance but cautioned that the 13% customer-pay and 31% warranty growth rates are not sustainable long-term, though he sees resilience in new car margins. SVP Pete DeLongchamps added that forecasting the 2026 lease return impact is difficult due to uncertainty around future vehicle equity, especially for BEVs. CFO Daniel McHenry noted UK SG&A should improve in Q3.

Ask Fintool Equity Research AI

Answer

President Jeff Dyke highlighted the unexpected strength in July sales, record F&I performance, and EchoPark's profitability as key positives. He noted the F&I per unit of $2,700 is sustainable. Dyke also emphasized that the upcoming increase in lease returns starting in 2026 will be a 'game changer' for used vehicle inventory acquisition, particularly for EchoPark. CEO David Smith added that EchoPark stores have significant performance runway and noted the seasonal strength expected from the Powersports segment in Q3.

Ask Fintool Equity Research AI

Answer

CEO David Smith attributed the strong sales to experienced teammates and company culture. President Jeff Dyke provided color on strong performance from Honda and luxury brands, which offset weakness in domestic brands like Stellantis. On the technician topic, Jeff Dyke quantified the opportunity at $20,000-$23,000 in gross profit per tech per month, aligning with the company's $100 million annualized gross profit goal.

Ask Fintool Equity Research AI

Answer

President & CEO Bill Nash explained that the record GPU was a result of flowing through savings from logistics and reconditioning efficiencies in a strong demand environment. He confirmed that older cars, when brought to CarMax standards, are unique and typically generate higher margins. CFO Enrique Mayor-Mora added that sales of cars under $20,000 were a key driver of the comp.

Ask Fintool Equity Research AI

Answer

CEO William Nash stated a clear intention to grow the wholesale business as much as possible, driven by a strong internal focus on buying more cars. He noted that while the 'Max Offer' product has good reach, there remains a large opportunity to sign up more dealers, offering them a valuable alternative to traditional disposition channels.

Ask Fintool Equity Research AI