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Global Economic Shifts: China’s Policy Tightening, RBC’s US Expansion, EU-Vietnam Trade Progress, and UK Inflation Concerns
Stock Market News· 2025-09-26 11:08
Key TakeawaysChina's central bank is signaling a dual focus on improving monetary policy while also tightening control over money regulation, indicating potential shifts in its financial oversight.RBC's CEO McKay announced plans to significantly expand the bank's wealth adviser team by acquiring U.S. companies, signaling strategic growth in the North American market.The European Union and Vietnam are advancing their Free Trade Agreement (FTA), establishing a task force to review issues and anticipating more ...
CVNA vs. ABG: Which Auto Retailer Should You Park in Your Portfolio?
ZACKS· 2025-07-10 15:15
Core Viewpoint - Carvana and Asbury Automotive represent two distinct approaches in the auto retail sector, with Carvana focusing on a fully digital used-car buying experience and Asbury blending traditional dealership strengths with digital initiatives [2][3]. Group 1: Carvana (CVNA) - Carvana is the second-largest used car retailer in the U.S., leveraging a digital platform that allows for a leaner operation compared to traditional retailers [4]. - The company has consistently exceeded earnings expectations for four consecutive quarters, selling over 100,000 vehicles per quarter, with a year-over-year EPS increase and a 46% rise in retail unit sales [5]. - Carvana's adjusted EBITDA reached a record $488 million with an 11.5% margin, leading all auto retailers in adjusted EBITDA margin [6]. - Rising tariffs on new vehicles may drive more consumers to the used car market, where Carvana is well-positioned [7]. - Despite over $5 billion in long-term debt, Carvana's scalable model and growth targets present a compelling narrative for investors [7]. Group 2: Asbury Automotive (ABG) - Asbury combines traditional dealership operations with a growing digital presence, selling both new and used vehicles and generating additional revenue from finance and insurance products [10]. - The Clicklane platform has shown growth, selling over 51,000 units in 2024, a 13% increase year-over-year [11]. - Strategic acquisitions have been a key growth strategy, with the latest acquisition expected to add $3 billion in annualized revenues [12]. - Asbury faces near-term challenges, including deferred revenues impacting earnings and rising SG&A costs, which reached 63.9% of gross profit [14]. - The company's adjusted EBITDA margin is below 6%, significantly lower than Carvana's, and high capital expenditures could limit free cash flow [14]. Group 3: Market Performance and Valuation - Year-to-date, Carvana shares have increased by over 70%, while Asbury's stock has gained 7% [16]. - Carvana's forward sales multiple is 3.67, significantly above its five-year median of 1.95, reflecting high growth expectations [18]. - Asbury's forward sales multiple stands at 0.27, indicating a more conservative valuation [18].