AutoNation Rebranding Yields Record-Breaking Quarter

Rebranding can go a long way. AutoNation, Inc. (AN) reported their best quarter ever, pulling in $4.1 billion in revenue for the quarter over estimates of $4.03 billion. AutoNation CEO and Chairman Mike Jackson appeared on CNBC Squawk Box to talk about their company record quarterly EPS from continuing operations, hitting $0.68 opposed to analyst estimates of $0.64. Jackson said that the company owed much of the quarter's success to their massive rebranding effort. "It was no doubt in my mind that it was going to succeed. No JCPenny moves at AutoNation," Jackson said. AutoNation's new vehicle sales increased by a total of 9%, and they will be acquiring SanTan Honda Superstore and Hyundai of Tempe in Phoenix, and Don Davis Toyota Scion in Dallas. The combined annual revenue for the three stores is about $250 million. Theses acquisitions are expected to be finalized by the second quarter of 2013. AutoNation has three operating segments Domestic, Import, and Premium Luxury. The Domestic segment sells vehicles manufactured by General Motors, Ford, and Chrysler, showing income of $59 million opposed to last year's segment income of $50 million; the Import segment sells vehicles manufactured by Toyota, Honda, Nissan, and Hyundai, showing income of $71 million opposed to last year's segment income of $62 million; and the Premium Luxury segment, which sells vehicles manufactured by Mercedes-Benz, BMW, Lexus, and Audi, showing income of $69 million opposed to last year's segment income of $59 million. Jackson said that putting a coast-to-coast brand up really means something in the marketplace, providing something that you can "stand behind." So far, 30% of their Domestic and Import units were sold under the rebranded AutoNation name.