What Makes Asbury Automotive Group (ABG) an Attractive Investment?
Black Bear Value Partners, an investment management firm, published its fourth quarter 2022 investor letter, a copy of which can be downloaded here. Black Bear Value Fund returned 1.8% in December and 12.5% in 2022 compared to the S&P 500’s return of -5.8% in December and -18.1% in 2022. In addition, please check the fund’s top five holdings to know its best picks in 2022.
Black Bear Value Partners highlighted stocks like Asbury Automotive Group, Inc. (NYSE:ABG) in the Q4 2022 investor letter. Headquartered in Duluth, Georgia, Asbury Automotive Group, Inc. (NYSE:ABG) is a US-based automotive retailer. On March 2, 2023, Asbury Automotive Group, Inc. (NYSE:ABG) stock closed at $232.75 per share. One-month return of Asbury Automotive Group, Inc. (NYSE:ABG) was -4.27%, and its shares gained 21.95% of their value over the last 52 weeks. Asbury Automotive Group, Inc. (NYSE:ABG) has a market capitalization of $5.151 billion.
Black Bear Value Partners made the following comment about Asbury Automotive Group, Inc. (NYSE:ABG) in its Q4 2022 investor letter:
“Asbury Automotive Group, Inc. (NYSE:ABG) operates auto dealerships across the United States. We have written at length about our affinity for the auto-dealer business. While much attention is paid to the number of cars sold, the strength of the model comes from the back of the house in parts and services where more than 50% of the profits come from. We are exiting a period of high margins on new and used car sales. Shortages of inventory have allowed dealers to make record profits when selling a car. As inventories normalize and interest rates rise, I fully expect the dealers to make less profit (called the GPU) when selling a car. Car prices cannot go up ad-infinitum and at some point, there will be buyer pushback.
Less discussed is while profits per car are at all-time highs, the volumes sold have mirrored prior recessions. My expectation is that dealers will likely make less per car but will mitigate some of that pressure by selling more cars, especially used vehicles, as prices drop...” (Click here to read the full text)
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Asbury Automotive Group, Inc. (NYSE:ABG) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 26 hedge fund portfolios held Asbury Automotive Group, Inc. (NYSE:ABG) at the end of the fourth quarter which was 34 in the previous quarter.
We discussed Asbury Automotive Group, Inc. (NYSE:ABG) in another article and shared the list of most undervalued auto stocks according to hedge funds. In addition, please check out our hedge fund investor letters Q4 2022 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
