Dire assessment on U.S. auto from BAML
Seeking Alpha
Published Jun 16, 2017 08:49AM ET
Dire assessment on U.S. auto from BAML
- Bank of America Merrill Lynch (NYSE:BAC) issues a warning on U.S. auto that could reverberate around trading on suppliers and manufacturing.
- The firm sees a "swift and material" downturn that will lead to a U.S. sales growth fall to a 13M unit annual selling rate by around 2021 and a "tsunami" of off-lease volume whacking pricing. Raw material costs are seen potentially moving in the wrong direction for the industry.
- Lithia Motors (NYSE:LAD) is singled out with a cut to Underperform, while price target reduction are fired off on F, GM, FCAU, ADNT, AXL, BWA, CPS, DLPH, GNTX, LEA, MGA, AN, GPI, LAD, PAG, SAH and KMX. Volatile auto rental names Avis Budget (NASDAQ:CAR) and Hertz (NYSE:HTZ) could also be impacted by the BAML gloom.
- Related ETF: CARZ.
- Source: Bloomberg
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