The auto market has recorded its longest run of weakness since the GFC, the broker notes, and its only getting worse. Autosports result, in line with a pre-release, demonstrated a high degree of financial and operational leverage in the company’s business model.
Earnings numbers will be cycling softer comparables ahead but while the broker feels a nadir may be approaching, it would like to see more evidence before becoming more confident, while noting acquisition optionality for the company is compelling.
Neutral retained, target rises to $1.15 from $1.00.
Target price is $1.15.Current Price is $1.15. Difference: $0.00 – (brackets indicate current price is over target). If ASG meets the Macquarie target it will return approximately 0% (excluding dividends, fees and charges – negative figures indicate an expected loss).