10:35 AM EDT, 04/25/2024 (MT Newswires) -- CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:

We lower our 12-month target price by $5 to $245, based on a 2025 P/E of 7.0x, a justified discount to ABG's five-year mean forward P/E of 8.2x. We lower our adjusted EPS estimates to $30.60 from $31.75 for 2024 and to $34.80 from $38.20 for 2025. ABG posted Q1 EPS of $7.21 vs. $8.37 (-14%), short of the $7.93 consensus. Revenue rose 17% to $4.20B ($70M below consensus) and gross margin contracted 160 bps to 17.9% (in line with consensus). Average sales prices were down 1% for new vehicles and down 3% for used vehicles, while volumes were up 18% for new and 20% for used vehicles. While near-term earnings comps are likely to remain difficult, ABG screens as one of the most inexpensive auto dealership equities and we think its recent acquisition of Koons Automotive, the U.S.'s ninth largest privately-owned dealership ($3B+ of annual revenue), sets the stage for above-average bottom-line growth over the next couple of years. Ongoing share repurchases are a positive, as ABG bought back 240K shares for $50M in Q1.