Is Asbury Automotive Group (ABG) a Smart Long-Term Buy?

Vltava Fund, an investment management firm, published its first-quarter 2022 investor letter – a copy of which can be downloaded here. In its Q1 2022 investor letter, Vltava Fund talked about the impact of the Russian and Ukrainian economy’s collapse on the global economy and mentioned some changes in its portfolio. Try to spend some time taking a look at the fund’s top 5 holdings to be informed about their best picks for 2022.

In its Q1 2022 investor letter, Vltava Fund mentioned Asbury Automotive Group, Inc. (NYSE:ABG) and explained its insights for the company. Founded in 1995, Asbury Automotive Group, Inc. (NYSE:ABG)  is a Duluth, Georgia-based automotive retail company with a $3.7 billion market capitalization. Asbury Automotive Group, Inc. (NYSE:ABG)  delivered a -6.44% return since the beginning of the year, while its 12-month returns are down by -18.91%. The stock closed at $161.61 per share on April 12, 2022.

Here is what Vltava Fund has to say about Asbury Automotive Group, Inc. (NYSE:ABG) in its Q1 2022 investor letter:

“We then used the money freed up to, among other things, open three new positions. The stock price declines during the Russian invasion brought a lot of good prices to the market. Out of all the possibilities we considered, we picked the stocks of Asbury Automotive Group (ABG).

Asbury Automotive Group is one of the largest car dealership chains in the United States. Its revenues and profits come from new car sales, used car sales, service and parts, and financing and insurance brokerage. This industry is relatively well known to us due to our earlier investment in Autonation (AN). This time, we decided to enter it through ABG. ABG has long been growing very rapidly through a combination of organic growth and acquisitions. It has a very good and efficient asset allocation policy and a lot of room ahead to continue growing due to the great fragmentation of the whole sector. The longterm development puts small sellers at a disadvantage and the whole sector is heading towards further gradual consolidation. We expect ABG to play an important role in this and for its shareholders to benefit accordingly.”

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Our calculations show that Asbury Automotive Group, Inc. (NYSE:ABG) fell short and didn’t make it on our list of the 30 Most Popular Stocks Among Hedge Funds. Asbury Automotive Group, Inc. (NYSE:ABG) was in 32 hedge fund portfolios at the end of the first quarter of 2022, compared to 22 funds in the previous quarter. Asbury Automotive Group, Inc. (NYSE:ABG) delivered a -10.22% return in the past 3 months.

In March 2022, we also shared another hedge fund’s views on Asbury Automotive Group, Inc. (NYSE:ABG) in another article. You can find more investor letters from hedge funds and prominent investors on our hedge fund investor letters 2022 Q1 page.

Disclosure: None. This article is originally published at Insider Monkey.