Chris Pierce, an analyst from Needham, reiterated the Buy rating on Sonic Automotive (SAH – Research Report). The associated price target was raised to $100.00.
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Chris Pierce’s rating is based on a number of strategic assessments regarding Sonic Automotive’s current and future potential. Firstly, Pierce is optimistic about the company’s franchise operations, noting effective execution and an improved valuation multiple. This suggests a confidence in the company’s ability to maintain and enhance its market position.
Additionally, despite Echo Park’s recent challenges in terms of unit and earnings trajectories, Pierce sees it as a significant growth opportunity. The resolution of previous inventory issues is expected to bolster future growth, contributing to the overall positive outlook. The new $100 target price reflects the valuation of Sonic Automotive’s franchise dealerships and Echo Park, adjusted for a scale discount, indicating a belief in the company’s long-term growth potential.