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    A Look At AutoNation’s (AN) Valuation As It Shifts Toward More Affordable Used Vehicles

    Simply Wall St·02/23/2026 10:19:52
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    Why AutoNation’s Used Car Shift Matters for Investors

    AutoNation (AN) is refocusing its used vehicle strategy, aiming to acquire more cars priced under $30,000 while keeping quality standards high, a move that could influence margins, volume, and investor expectations.

    See our latest analysis for AutoNation.

    At a share price of $201.47, AutoNation has had a softer few months, with a 30 day share price return of 5.97% decline and year to date share price return of 2.43% decline. However, its 1 year total shareholder return of 11.09% and 5 year total shareholder return of 168.56% show that, over time, shareholders have still been rewarded. This frames the renewed push into more affordable used vehicles as part of a longer running, but currently cooling, momentum story.

    If this used car shift has you thinking about where else value might be hiding, it could be worth widening your search with our 22 top founder-led companies.

    With AutoNation trading at $201.47 and sitting at a 19.67% discount to the average analyst price target and a 29.39% intrinsic discount, is the recent pullback an opening, or is the market already baking in future growth?

    Most Popular Narrative: 15.8% Undervalued

    With AutoNation closing at $201.47 against a narrative fair value of $239.30, the current pricing gap centers on steady but measured growth assumptions.

    Record growth in after-sales and expanding used vehicle operations are driving stable, high-margin revenue with continued strength expected from changing industry dynamics. Investments in digital transformation, finance, and strategic acquisitions are improving efficiency, customer reach, and positioning for profit expansion over time.

    Read the complete narrative.

    Want to see what sits behind that confidence in profit expansion? The narrative leans on moderate revenue growth, firmer margins, and a future earnings multiple that has to do some work. The full set of assumptions ties those moving parts together into the $239.30 fair value.

    Result: Fair Value of $239.30 (UNDERVALUED)

    Have a read of the narrative in full and understand what's behind the forecasts.

    However, that profit expansion story could be knocked off course if direct to consumer models pressure dealership economics, or if faster EV adoption chips away at high margin after sales revenue.

    Find out about the key risks to this AutoNation narrative.

    Next Steps

    If this mix of optimism and concern feels finely balanced, it may be helpful to look at the numbers yourself and weigh both sides of the story. You can see how the positives compare with the risks in our breakdown of 3 key rewards and 1 important warning sign.

    Looking for more investment ideas?

    AutoNation is just one piece of your portfolio puzzle, so consider lining up a few more ideas before the next move catches you off guard.

    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.