Eagers Automotive Ltd

APE: XASX (AUS)

Morningstar Rating for Stocks	Fair Value	Economic Moat	Capital Allocation
	A$14.40	Gmkhz	Cbjqzfh

Eagers Automotive Enjoys Superior Size and Scale Over Smaller Competitors

Angus Hewitt

Aug 27, 2020

Business Strategy and Outlook

We expect competitively advantaged Eagers Automotive to return to EPS growth in 2021 following a challenging year for auto sales in 2020. Despite being the first full year of earnings following the merger with Automotive Holdings, we expect earnings per share to decline in 2020 as coronavirus-induced shutdowns weigh on new-vehicle sales. However, we do not expect these headwinds to prove protracted. We forecast new-vehicle sales to pick up again in 2021, leading to a five-year EPS CAGR of 17%.

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United States