Recent share performance and business scale
Asbury Automotive Group (ABG) has seen its share price move lower recently, with a 2.3% decline over the past day and deeper negative returns over the past week, month and past 3 months.
Against that share price backdrop, the company reports annual revenue of US$18.0b and net income of US$492.0m, reflecting a sizeable U.S. automotive retail operation across dealerships and related service offerings.
See our latest analysis for Asbury Automotive Group.
At a share price of US$199.40, Asbury’s recent 1 day, 1 month and 3 month share price returns show pressure building on the downside, while the 1 year total shareholder return of 19.26% decline hints at weaker longer term momentum.
If these moves in auto retail are making you review your watchlist, it could be a good moment to scan our list of 20 top founder-led companies as potential new ideas to research.
With the share price under pressure despite annual revenue of US$18.0b and net income of US$492.0m, the key question now is whether Asbury is quietly undervalued or if the market is already pricing in its future growth potential.
Most Popular Narrative: 22% Undervalued
Against the last close of $199.40, the most followed narrative pins fair value for Asbury Automotive Group at about $255.50, using a 12.04% discount rate to bring future cash flows back to today.
The acquisition of Herb Chambers expands Asbury's presence in a stable, affluent market (New England) with a high mix of luxury brands, expected to further boost average transaction values and provide earnings resilience, supporting future revenue and margin growth.
Curious what kind of revenue path and margin profile are built into that fair value, and how long term earnings are framed against a lower future P/E? The narrative leans on measured growth assumptions and a moderate earnings multiple, rather than blue sky optimism, to land at that $255.50 figure.
Result: Fair Value of $255.50 (UNDERVALUED)
Have a read of the narrative in full and understand what's behind the forecasts.
However, this hinges on acquisitions being absorbed smoothly, and on Asbury keeping up with digital and direct sales models that could pressure traditional dealership revenue and margins.
Find out about the key risks to this Asbury Automotive Group narrative.
Next Steps
Mixed signals on value and risks so far, so if this has you on the fence, consider acting promptly and review the full picture for yourself with 5 key rewards and 1 important warning sign.
Looking for more investment ideas?
If Asbury has you rethinking your next move, do not stop here. Use this moment to broaden your watchlist and pressure test your current holdings.
- Target reliable upside potential by scanning our list of 48 high quality undervalued stocks backed by stronger fundamentals than their current prices suggest.
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- Strengthen your downside protection by assessing 68 resilient stocks with low risk scores designed to keep overall risk scores in check when markets turn.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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