ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. Sonic Automotive's annualized return on capital (ROC %) for the quarter that ended in Mar. 2026 was 6.97%.
As of today (2026-06-24), Sonic Automotive's WACC % is 6.37%. Sonic Automotive's ROC % is 6.72% (calculated using TTM income statement data).
Sonic Automotive generates higher returns on investment than it costs the company to raise the capital needed for that investment. It is earning excess returns. A firm that expects to continue generating positive excess returns on new investments in the future will see its value increase as growth increases.
Sonic Automotive (NYSE:SAH) ROC % Explanation
ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. The reason book values of debt and equity are used is because the book values are the capital the company received when issuing the debt or receiving the equity investments.
There are four key components to this definition. The first is the use of operating income or EBIT rather than net income in the numerator. The second is the tax adjustment to this operating income or EBIT, computed as a hypothetical tax based on an effective or marginal tax rate. The third is the use of book values for invested capital, rather than market values. The final is the timing difference; the capital invested is from the end of the prior year whereas the operating income or EBIT is the current year's number.
Why is ROC % important?
Because it costs money to raise capital. A firm that generates higher returns on investment than it costs the company to raise the capital needed for that investment is earning excess returns. A firm that expects to continue generating positive excess returns on new investments in the future will see its value increase as growth increases, whereas a firm that earns returns that do not match up to its cost of capital will destroy value as it grows.
As of today, Sonic Automotive's WACC % is 6.37%. Sonic Automotive's ROC % is 6.72% (calculated using TTM income statement data).
Sonic Automotive generates higher returns on investment than it costs the company to raise the capital needed for that investment. It is earning excess returns. A firm that expects to continue generating positive excess returns on new investments in the future will see its value increase as growth increases.
Be Aware
Like ROE % and ROA %, ROC % is calculated with only 12 months of data. Fluctuations in the company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective.
Sonic Automotive ROC % Related Terms
Sonic Automotive ROC % Historical Data
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The historical data trend for Sonic Automotive's ROC % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Note:
The Operating Income data used here is four times the quarterly (Mar. 2026) data.
The tax rate is limited to between 0% and 100%.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Sonic Automotive (SAH) has a ROC % of 6.97% as of Mar. 2026. Return on capital is the ratio of current-period net income to average two-period capital. View historical data on Sonic Automotive and its competitors.
Is Sonic Automotive's ROC % too high?
Sonic Automotive's current ROC % is 6.97%. The Vehicles & Parts industry median ROC % is 5.07. Sonic Automotive's value of 6.97% is 37.5% above this industry median. Overall, Sonic Automotive has a GF Score™ of 82/100 and is considered Modestly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Sonic Automotive's ROC % compare to CARG and MCW?
Sonic Automotive's ROC % of 6.97% can be compared against companies in the Vehicles & Parts industry. The industry median ROC % is 5.07. Sonic Automotive's value of 6.97% is 37.5% above this benchmark. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good ROC % for a Vehicles & Parts company?
The median ROC % among Vehicles & Parts companies is 5.07, based on 1,316 companies in the industry. Companies in the top quartile (top 25%) have a ROC % significantly above this median, while those in the bottom quartile fall well below. However, ROC % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Sonic Automotive's current ROC % of 6.97% is 37.5% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high ROC % mean?
A high ROC % can signal that a stock is expensive relative to its fundamentals. Return on capital is the ratio of current-period net income to average two-period capital. View historical data on Sonic Automotive and its competitors. For the Vehicles & Parts industry, the median ROC % is 5.07 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Sonic Automotive's current ROC % is 6.97%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Sonic Automotive stock overvalued right now?
Based on GuruFocus' analysis, Sonic Automotive (SAH) is currently considered Modestly Overvalued. The stock's GF Value™ is $64.31, compared to a current price of $83.83 — trading 30.4% above its estimated fair value. The current ROC % is 6.97% and 37.5% above the Vehicles & Parts industry median of 5.07. Sonic Automotive's overall GF Score™ is 82/100 with 5 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is ROC % calculated?
ROC % is calculated from a company's financial statements. For Sonic Automotive (SAH), the current ROC % is 6.97% as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Sonic Automotive (SAH) Overvalued in 2026?
Based on GuruFocus' analysis, Sonic Automotive stock appears to be overvalued.
The current stock price of $83.83 is trading 30.4% above its estimated GF Value™ of $64.31.
GuruFocus considers Sonic Automotive to be Modestly Overvalued.
Key valuation signals for SAH:
ROC %: 6.97%
GF Value™: $64.31 vs. price of $83.83 (30.4% above fair value)
Industry Position: 37.5% above the Vehicles & Parts median
No single metric tells the full story. See the SAH stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Sonic Automotive is one of the largest auto dealership groups in the United States. The company has 107 franchised stores in 18 states, primarily in metropolitan areas in California, Texas, and the Southeast, plus 18 EchoPark used-vehicle stores in 10 states, 16 collision centers, and 20 powersports locations. The franchise stores derive revenue from new and used vehicles plus parts and collision repair, finance, insurance, and wholesale auctions. Luxury and import dealerships make up about 86% of franchise new-vehicle revenue, while Honda, BMW, Mercedes, and Toyota constitute about 56% of new-vehicle revenue. BMW is the largest brand at about 23%. 2025 revenue was $15.2 billion, with Texas and California constituting 51% of the total. EchoPark's portion was $2.1 billion.
82GF Score
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