J.P.Morgan lowers PTs on auto retailers on dour quarterly results

Lithia Motors

16/02/2024 13:31

** Brokerage J.P.Morgan lowers price targets on automotive
retailer Lithia Motors  LAD.N  to $285 from $295 and peer Penske
Automotive Group  PAG.N  to $135 from $136 in response to recent
quarterly results
    ** Says auto sector unlikely to benefit from any "rising
tide" on depletion of consumer excess savings 
    ** "Used vehicles remains under significant pressure due to
affordability and late-model supply challenges, while Parts &
Services is slowing broadly as expected" - JPM
    ** Says EV demand is slowing now that the early-adopter
demand is satiated and erosion of GPUs, graphics processing
units used in self-driving cars, continues amidst inventory
building
    ** JPM reiterates PTs on Asbury Automotive Group  ABG.N ,
Autonation  AN.N  and Group 1 Automotive  GPI.n , also raises
their 2024 EPS estimates 
    ** Says recent results for automakers and retailers point at
new vehicle demand remaining steady and hybrids being better
positioned than EVs
    ** So far in 2024, LAD had fallen 7.6% and PAG had fallen
5.6%

 (Reporting by Aatreyee Dasgupta)
 ((Aatreyee.Dasgupta@thomsonreuters.com))