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Ooops! Eagers (ASX: APE) had an accident

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Question asked 06/11/2026

Ooops! Eagers (ASX: APE) had an accident

You stated today in Match Out that this huge hit was an overreaction but do you still consider it a buy? Or is it more a hold and see what happens. I bought a 2% allocation with MMs trade alert and I'm considering buying another 2% to top up to your suggested allocation. Thoughts? Tim As a holder of Eagers (APE), I was surprised by the market reaction to its recent results announcement. I see their Canadian acquisition seems to be going well and will contribute a full years earnings this year. So, is APE worth topping up given current headwinds (high interest rates and cost of living pressures) should reduce over time? Also, what dividend do you expect them to pay in the second half as they have been paying higher dividends in that half over the last few years. Thanks, Peter

Answer

Hi Guys,

Our risk profile will prevent us from adding to our position, but we do stick with our view that the stock was oversold, with a few “pros and cons” towards the stock going into the weekend:

Pro: we believe that interest rates have topped and the retail sector should continue its recent outperformance into 2027.
Pro: APE’s headline numbers and growth in Canada looked good and the 13% sell-off on a revenue guidance miss of just 2.2% feels overdone.
Con: Stocks that “miss/disappoint” are remaining in the “naughty corner” for weeks with few stocks reversing quickly.
Con: Higher interest rates and cost-of-living pressures are increasingly weighing on consumers, and big-ticket discretionary purchases such as cars are an obvious place for households to pull back.

In terms of dividends in February and August ’27 we would be looking for 25c and 51c fully franked, respectively – this should be easily achieved despite the ~2% revenue downgrade, if earnings margins remain on track.

Overall, our entry into the stock wasn’t perfect, given the timing of the announcement, however we still like APE around $16.

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Eagers Automotive Ltd (APE)

LAST UPDATED 06/11/2026 11:13

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