Car dealership business APE advanced +1.4% on Wednesday as retail stocks rallied strongly, in 2022 the business has struggled to meet strong demand due to dire supply issues from a number of car makers, the market imbalance due to a computer chip shortage has gone berserk with 2-year old cars selling for more than when they were new! We like this quality business although the demand side of the curve will need to be monitored carefully as interest rate hikes start to influence the consumer, or not as the case may be.
- We believe the stock is good value trading on an Est P/E of 13x for 2022 while its projected 12-month 5.4% yield is relatively attractive.
NB APE reports its 1H earnings next Wednesday which is likely to add some volatility to the mix.
MM likes APE ~$12
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