Is AutoNation, Inc. overvalued or undervalued?

As of 7 July 2025, the valuation grade for AutoNation, Inc. has moved from expensive to attractive, indicating a shift towards a more favorable assessment. The company appears undervalued, supported by a P/E ratio of 16, an EV to EBITDA ratio of 15.04, and a Price to Book Value of 4.57. In comparison, peers such as Dick's Sporting Goods, Inc. have a P/E of 30.66, while Penske Automotive Group, Inc. shows a lower P/E of 12.91, highlighting AutoNation's relative valuation attractiveness.
In terms of performance, AutoNation has outperformed the S&P 500 with a year-to-date return of 30.18% compared to the index's 12.22%, and a remarkable 5-year return of 314.36% versus 96.61% for the S&P 500. This strong performance reinforces the notion that AutoNation is currently undervalued in the market.