Morningstar

Eagers Automotive Ltd APE

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Stock XASX Rating as of
A$10.96 +0.22 (2.05%)
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As of Delayed Price Closed

Company Report

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Eagers Earnings: Competition in Auto Sales Intensifying, Weighing on Profitability

Angus Hewitt

Boom times in the Australian auto market have come to an end, and Eagers Automotive, Australia’s largest dealer, is not immune. While sales growth remained firm in the first half of calendar 2024, up 13% on the previous corresponding period—roughly in line with Australian new-car sales—competition is returning. To unwind excess inventory, promotions have accelerated, putting pressure on profitability across the sector. First-half 2024 underlying profit before tax fell 13% on the PCP to AUD 183 million.

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Price vs Fair Value

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APE is trading at a 629% premium.
Price
A$10.96
Fair Value
A$99.80
Uncertainty
High
1-Star Price
A$67.67
5-Star Price
A$4.80
Economic Moat
Llzpcy
Capital Allocation
Vznktrx

Bulls Say, Bears Say

Bulls

Eagers is well positioned to participate in and to benefit from the consolidation theme in the automotive dealership industry through acquisitions and greenfield developments.

Bears

Easing supply constraints may see dealerships once again competing on price, putting pressure on Eagers' margins.

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Trading Information

Previous Close Price
A$10.74
Day Range
A$10.80–11.08
52-Week Range
A$9.78–15.27
Bid/Ask
A$11.20 / A$10.67
Market Cap
A$2.83 Bil
Volume/Avg
841,469 / 792,515

Key Statistics

Price/Earnings (Normalized)
10.77
Price/Sales
0.27
Dividend Yield (Trailing)
6.75%
Dividend Yield (Forward)
6.75%
Total Yield
6.94%

Company Profile

Eagers Automotive is the largest automotive retailing group in the Australian market, with an estimated share of over 11% of new-vehicle sales. The company offers a range of products and services, including the sale of new and used vehicles, vehicle repair services, and parts. The company also facilitates vehicle financing through third-party providers. Additionally, Eagers operates a truck retailing business, offering a similar range of products and services.
Sector
Consumer Cyclical
Industry
Auto & Truck Dealerships
Stock Style Box
Mid Value
Total Number of Employees
7,000
Website
https://www.eagersautomotive.com.au

Competitors

Valuation

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Metric
APE
ABG
AN
Price/Earnings (Normalized)
 10.778.479.59
Price/Book Value
 2.211.473.32
Price/Sales
 0.270.310.29
Price/Cash Flow
 8.105.827.09
Price/Earnings
APE
ABG
AN

Financial Strength

Metric
APE
ABG
AN
Quick Ratio
 0.280.200.15
Current Ratio
 1.021.250.78
Interest Coverage
 3.423.433.76
Quick Ratio
APE
ABG
AN

Profitability

Metric
APE
ABG
AN
Return on Assets (Normalized)
 5.65%6.28%6.86%
Return on Equity (Normalized)
 21.56%18.18%36.94%
Return on Invested Capital (Normalized)
 10.80%9.65%10.87%
Return on Assets
APE
ABG
AN

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