MeritValue

SONIC AUTOMOTIVE INC

SAHdata completeness 100%17 fiscal years on file
The thesis, from the filings

SONIC AUTOMOTIVE INC earns about 5% on invested capital, below its ~9% cost of capital, and has bought back 20% of its shares over 5 years — no moat visible in the numbers. The estimate methods put fair value between $19.97 and $53.22 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$12.4B1$14B2$14.4B3$14.2B3$15.2B3
Net income$348.9M4$88.5M5$178.2M6$216M6$118.7M6
Operating cash flow$306.3M7$406.1M8−$15.7M9$109.2M9$567.4M9
Capital expenditure−$298.2M10−$227.1M11−$203.6M12−$187.3M12−$149.9M12
Free cash flow (derived)$604.5M7$633.2M8$187.9M9$296.5M9$717.3M9
Total debt$3.12B13$3.5B14$3.35B15$3.18B16$3.23B16
Cash & equivalents$299.4M17$229.2M18$28.9M18$44M18$6.3M18
Diluted shares43.3M39.7M35.9M35.0M34.7M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$307.81
your share of equity
Profit it earned you last year
$34.21
Free cash flow it threw off
$206.71
Debt you’d be carrying
$931.07

10 shares is a claim on $307.81 of net worth that earned you $34.21 and generated $206.71 of cash last year, against $931.07 of debt.

iii. Is this a good business?
Moat signal · return on invested capital
5% avg · 5y
FY21 9%FY22 2%FY23 4%FY24 5%FY25 4%

It earned about 5% on invested capital against a ~9% cost of capital — below the cost of funding. The numbers show no moat.

seeing a moat in the numbers →
Management signal · capital allocation
−20% shares · 5y

Share count is down 20% over 5 years — management has been buying back stock, quietly handing owners a bigger slice. Total debt has held roughly steady.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0

The 3 estimate methods that apply put fair value between $19.97 and $53.22 a share. They rest on different assumptions, so where they diverge is the story; the Graham Number is a stricter floor, not a target.

DCF · Growth Exit 10Y
$19.97
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears10
  • fcfGrowth0.0%
  • fcfBase$296.5M
DCF · Growth Exit 5Y
$29.16
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears5
  • fcfGrowth0.0%
  • fcfBase$296.5M
Earnings Power Value
$53.22
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$178.2M
  • growthAssumed0.0%
Graham Number
$48.67
assumptions (1)
  • grahamMultiplier2250.0%

Different models answer different questions — which to trust when →

v. The price question — last, on purpose
Is today’s price fair?
See live price ↗
Type a price. The ledger answers.
Or set your own belief
FCF growth, next 5 years0.0%
Discount rate (WACC)8.93%
Terminal growth2.5%
At your growth, a share is worth $29.16
The three cases
Bear0.0%$29.16
Base0.0%$29.16
Bull5.0%$58.71

Bear/base/bull growth = 0% / filed history / history + 5pp. Type a price to see the return each case implies.

Default growth 0.0%= this company’s own filed history (median-to-median FCF CAGR, clamped 0–20%). Your adjustments are recorded anonymously. They become the “what do owners actually believe” dataset.

Sources — the receipts
  1. 10-K · period ending 2021-12-31 · accession 0001043509-24-000022 (RevenueFromContractWithCustomerExcludingAssessedTax)
  2. 10-K · period ending 2022-12-31 · accession 0001043509-25-000003 (RevenueFromContractWithCustomerExcludingAssessedTax)
  3. 10-K · period ending 2023-12-31 · accession 0001628280-26-010570 (RevenueFromContractWithCustomerExcludingAssessedTax)
  4. 10-K · period ending 2021-12-31 · accession 0001043509-24-000022 (NetIncomeLoss)
  5. 10-K · period ending 2022-12-31 · accession 0001043509-25-000003 (NetIncomeLoss)
  6. 10-K · period ending 2023-12-31 · accession 0001628280-26-010570 (NetIncomeLoss)
  7. 10-K · period ending 2021-12-31 · accession 0001043509-24-000022 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2022-12-31 · accession 0001043509-25-000003 (NetCashProvidedByUsedInOperatingActivities)
  9. 10-K · period ending 2023-12-31 · accession 0001628280-26-010570 (NetCashProvidedByUsedInOperatingActivities)
  10. 10-K · period ending 2021-12-31 · accession 0001043509-24-000022 (PaymentsToAcquirePropertyPlantAndEquipment)
  11. 10-K · period ending 2022-12-31 · accession 0001043509-25-000003 (PaymentsToAcquirePropertyPlantAndEquipment)
  12. 10-K · period ending 2023-12-31 · accession 0001628280-26-010570 (PaymentsToAcquirePropertyPlantAndEquipment)
  13. 10-K · period ending 2021-12-31 · accession 0001043509-23-000003 (LongTermDebtNoncurrent)
  14. 10-K · period ending 2022-12-31 · accession 0001043509-24-000022 (LongTermDebtNoncurrent)
  15. 10-K · period ending 2023-12-31 · accession 0001043509-25-000003 (LongTermDebtNoncurrent)
  16. 10-K · period ending 2024-12-31 · accession 0001628280-26-010570 (LongTermDebtNoncurrent)
  17. 10-K · period ending 2021-12-31 · accession 0001043509-25-000003 (CashAndCashEquivalentsAtCarryingValue)
  18. 10-K · period ending 2022-12-31 · accession 0001628280-26-010570 (CashAndCashEquivalentsAtCarryingValue)