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1. Company Snapshot

1.a. Company Description

Asbury Automotive Group, Inc., together with its subsidiaries, operates as an automotive retailer in the United States.It offers a range of automotive products and services, including new and used vehicles; and vehicle repair and maintenance services, replacement parts, and collision repair services.The company also provides finance and insurance products, including arranging vehicle financing through third parties; and aftermarket products, such as extended service contracts, guaranteed asset protection debt cancellation, prepaid maintenance, and credit life and disability insurance.


As of December 31, 2021, the company owned and operated 205 new vehicle franchises representing 31 brands of automobiles at 155 dealership locations; and 35 collision centers in the United States.Asbury Automotive Group, Inc.was founded in 1996 and is headquartered in Duluth, Georgia.

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1.b. Last Insights on ABG

Asbury Automotive Group's recent performance was driven by strong Q2 earnings, with net income increasing 443% to $153 million, and adjusted net income rising 13% to $146 million. The company's acquisition strategy, including the Herb Chambers Companies deal, has expanded its dealership footprint and revenue base. Despite margin pressure, parts and services remain resilient. Broker-backed stocks, including Asbury, stand out for growth potential and earnings strength amid market volatility. The company's strong parts/service profits and attractive free cash flow yields versus the S&P 500 are notable.

1.c. Company Highlights

2. Asbury Automotive Group's Q3 2025 Earnings: A Strong Performance

Asbury Automotive Group reported a record $4.8 billion in revenue for the third quarter of 2025, with a gross profit of $803 million and a gross profit margin of 16.7%. The company's adjusted earnings per share (EPS) was $7.17, beating analyst estimates of $6.8. The adjusted operating margin was 5.5%, and adjusted EBITDA was $261 million. The company's financial performance was driven by the acquisition of the Chambers Group, which has had a positive impact on operating metrics.

Publication Date: Oct -31

📋 Highlights
  • Record Revenue and Profit Growth:: Generated $4.8B revenue with $803M gross profit (16.7% margin) and $261M adjusted EBITDA in Q3.
  • Operational Expansion:: Chambers Group acquisition drove 8% YoY same-store revenue growth and 7% unit growth, supported by 23 Tekion-rolled-out stores.
  • EV Demand Surge:: EV volume doubled in Q3 vs. Q2, though average EV gross profit per car remains significantly lower than ICE vehicles.
  • Strong Liquidity and Cash Flow:: Ended Q3 with $686M liquidity and $543M adjusted operating cash flow YTD, up 11% YoY.
  • TCA EPS Outlook Adjusted:: EPS accretion dropped to $0.81 (from $5.69) due to Chambers deferral headwinds, store divestitures, and lower SAAR assumptions (15.8M vs. 17M).

Revenue Growth and Margin Analysis

The company's same-store revenue was up 8% year-over-year, driven by a 7% increase in units sold. The parts and service business delivered consistent results, with same-store gross profit up by 7% and the customer pay segment up by 8% in the quarter. The company's new vehicle performance on an all-store basis highlights the impact of the Herb Chambers acquisition and the heavier weighting towards luxury brands.

Operational Highlights

The company has made significant progress in its transition to Tekion, which will transform how it sells and services vehicles and delivers a superior guest experience. The company has rolled out Tekion to 23 stores, and expects to see gains in the middle of 2027. The early adopters will see gains in the middle of 2027, while the stores on the back end of integration will experience gains in early 2027, as stated by David Hult.

Valuation and Outlook

With a P/E Ratio of 8.28 and an EV/EBITDA ratio of 9.9, the company's valuation appears reasonable. Analysts estimate next year's revenue growth at 8.6%, which suggests a positive outlook for the company. The company's focus on share repurchases and debt reduction over the next 12 to 18 months is also expected to drive value for shareholders. The company's liquidity position is strong, with $686 million of liquidity, comprised of floor plan offset accounts, availability on both its used line and revolving credit facility, and cash.

Future Prospects

The company's acquisition of the Chambers Group is expected to continue to drive growth, and the rollout of Tekion is expected to drive productivity gains and cost savings. The company's luxury brands are expected to perform well, driven by strong consumer demand. The company's focus on balancing volume with profitability is also expected to drive value for shareholders.

3. NewsRoom

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Creative Planning Purchases 1,989 Shares of Asbury Automotive Group, Inc. $ABG

Nov -26

Source: defenseworld.net

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Asbury Automotive Group: Attractively Valued Amid A Challenging Economic Backdrop

Nov -19

Source: seekingalpha.com

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Park Place Motorcars Fort Worth Undergoes Major Renovation to Enhance Client Experience

Nov -03

Source: businesswire.com

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Is Asbury Automotive Stock a Buy After Investment Firm Magnolia Group Purchased Shares Worth Nearly $11 Million?

Oct -30

Source: fool.com

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Asbury Q3 Earnings Surpass Estimates, Revenues Rise Y/Y

Oct -29

Source: zacks.com

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Cwm LLC Has $220,000 Position in Asbury Automotive Group, Inc. $ABG

Oct -29

Source: defenseworld.net

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Asbury Automotive Group, Inc. (ABG) Q3 2025 Earnings Call Transcript

Oct -28

Source: seekingalpha.com

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Here's What Key Metrics Tell Us About Asbury Automotive (ABG) Q3 Earnings

Oct -28

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (7.43%)

6. Segments

Dealerships

Expected Growth: 7.5%

Asbury Automotive Group's 7.5% dealership growth is driven by strategic acquisitions, increasing F&I product penetration, and a focus on high-margin brands. Additionally, the company's One Asbury initiative aims to enhance the customer experience, driving revenue growth through increased retention and referrals. Furthermore, a strong used vehicle market and growing demand for luxury vehicles also contribute to the segment's growth.

Total Care Auto

Expected Growth: 8.5%

Total Care Auto's 8.5% growth is driven by increasing demand for vehicle maintenance and repair services, expansion of Asbury's service center network, and strategic acquisitions. Additionally, the rise of electric and autonomous vehicles, which require more complex and frequent maintenance, contributes to the segment's growth.

Eliminations

Expected Growth: 0.0%

Asbury Automotive Group, Inc. reports zero growth in eliminations, indicating a stable consolidation of intercompany transactions. This is driven by consistent internal sales and purchases, with no significant changes in business segments or accounting practices. The lack of growth suggests effective management of intercompany eliminations, maintaining a stable financial reporting structure.

7. Detailed Products

New Vehicle Sales

Asbury Automotive Group, Inc. sells new vehicles from various manufacturers such as Toyota, Ford, and Honda through its dealerships.

Used Vehicle Sales

The company sells pre-owned vehicles, including certified pre-owned vehicles, through its dealerships and online platforms.

Parts and Service

Asbury Automotive Group, Inc. offers parts and service repairs for vehicles, including routine maintenance, repairs, and warranty work.

Collision Repair

The company provides collision repair services, including body shop repairs and paintless dent repair, through its dealerships and standalone collision centers.

Finance and Insurance

Asbury Automotive Group, Inc. offers financing and insurance products, including extended warranties and service contracts, to customers.

Aftermarket Parts and Accessories

The company sells aftermarket parts and accessories, including tires, wheels, and performance upgrades, through its dealerships and online platforms.

8. Asbury Automotive Group, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Asbury Automotive Group, Inc. faces moderate threat from substitutes, as customers have limited alternatives for purchasing and servicing vehicles.

Bargaining Power Of Customers

Asbury Automotive Group, Inc. has a large customer base, which reduces the bargaining power of individual customers, giving the company an upper hand in negotiations.

Bargaining Power Of Suppliers

Asbury Automotive Group, Inc. relies on a few large suppliers for vehicles and parts, giving them some bargaining power, but the company's large scale of operations helps to mitigate this.

Threat Of New Entrants

The automotive retail industry has high barriers to entry, including significant capital requirements and regulatory hurdles, making it difficult for new entrants to compete with Asbury Automotive Group, Inc.

Intensity Of Rivalry

The automotive retail industry is highly competitive, with many established players competing for market share, which increases the intensity of rivalry for Asbury Automotive Group, Inc.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 60.61%
Debt Cost 4.41%
Equity Weight 39.39%
Equity Cost 9.80%
WACC 6.53%
Leverage 153.88%

11. Quality Control: Asbury Automotive Group, Inc. passed 3 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Penske Automotive Group

A-Score: 6.5/10

Value: 6.9

Growth: 7.1

Quality: 4.8

Yield: 5.0

Momentum: 7.0

Volatility: 8.0

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Asbury Automotive Group

A-Score: 5.4/10

Value: 7.9

Growth: 7.4

Quality: 4.0

Yield: 0.0

Momentum: 7.0

Volatility: 6.0

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Group 1 Automotive

A-Score: 5.4/10

Value: 6.6

Growth: 7.8

Quality: 3.5

Yield: 0.0

Momentum: 8.0

Volatility: 6.3

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A-Score: 5.3/10

Value: 6.7

Growth: 6.7

Quality: 5.2

Yield: 1.0

Momentum: 6.0

Volatility: 6.0

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Rush Enterprises

A-Score: 5.2/10

Value: 6.6

Growth: 4.7

Quality: 4.7

Yield: 3.0

Momentum: 5.0

Volatility: 7.3

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ACV Auctions

A-Score: 3.4/10

Value: 6.5

Growth: 5.4

Quality: 4.4

Yield: 0.0

Momentum: 0.5

Volatility: 3.7

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

238.9$

Current Price

238.9$

Potential

-0.00%

Expected Cash-Flows