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Is Asbury Automotive (ABG) a Great Long-Term Buy?


Voss Funds, an investment administration company, revealed its fourth-quarter 2021 trader letter – a duplicate of which can be downloaded right here. In Q4 2021, the Voss Worth Fund, LP and the Voss Worth Offshore Fund, Ltd., returned +13.6% and +14.3% to buyers net of expenses and charges, respectively, as opposed to +2.1% whole return for the Russell 2000, +3.9% price return for the Russell 2000 Price, and +11.% whole return for the S&P 500. Spare some time to verify the fund’s major 5 holdings to have a clue about their top rated bets for 2022.

Voss Cash, in its Q4 2021 investor letter, mentioned Asbury Automotive Group, Inc. (NYSE:ABG) and reviewed its stance on the company. Launched in 1995, Asbury Automotive Group, Inc. (NYSE:ABG) is a Duluth, Ga-dependent automotive retail enterprise with a $4.3 billion market capitalization, and is at the moment spearheaded by its CEO, David W. Hult. Asbury Automotive Group, Inc. (NYSE:ABG) shipped an 8.15% return given that the commencing of the year, whilst its 12-thirty day period returns are up by 2.99%. The stock shut at $186.80 for every share on March 22, 2022.

Here is what Voss Capital has to say about Asbury Automotive Group, Inc. (NYSE:ABG) in its Q4 2021 trader letter:

Asbury Automotive is an auto vendor that we acquired recently at ~5x earnings and free hard cash move. We feel the stock’s benefit has been partly obscured by their latest acquisitions alongside with auto sellers having derated substantially around the previous couple of months because of to perceived fears of “about earning” in 2021 and 2022, as normal earnings for every vehicle has shot up because of to provide constraints. We have made a framework of “normalized earnings” for 2023 and concluded that ABG trades at ~7x earnings versus a historical range of 7-15x, or close to 11x on normal. We therefore imagine the stock can rerate to 11x normalized earnings, or all around 40-50% higher from our buy selling price of ~$160. Downside really should be restricted presented the firm’s quite depressed multiples, even though we will be watching for an acceleration of charges raising which could whack what is at the moment pent-up need for automobiles.”

Car, Automotive, Oil

Vehicle, Automotive, Oil


Our calculations present that Asbury Automotive Group, Inc. (NYSE:ABG) failed to acquire a mark on our listing of the 30 Most Preferred Shares Among the Hedge Funds. Asbury Automotive Group, Inc. (NYSE:ABG) was in 32 hedge fund portfolios at the close of the fourth quarter of 2021, in contrast to 22 funds in the former quarter. Asbury Automotive Group, Inc. (NYSE:ABG) delivered a 14.17% return in the past 3 months.

In March 2022, we also shared one more hedge fund’s views on Asbury Automotive Group, Inc. (NYSE:ABG) in one more write-up. You can discover other letters from hedge money and popular investors on our hedge fund investor letters 2021 Q4 webpage.

Disclosure: None. This article is originally published at Insider Monkey.


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