What is Happening to Automotive Holdings Group LTD’s Share price?

AHG Automotive Holdings

What’s Happening to Automotive Holdings Ltd’s Share Price?

During the previous trading week, Automotive Holdings Group Ltd [ASX:AHE], Australia’s largest car retailer by sales, with 169 dealership franchise sites across Australia and New Zealand, broke into new highs.

What is the AHG chart telling you?

I find it useful to bring up a chart. Here’s the monthly of AHG Ltd.

Automotive Holdings
AHG delivered a record first-half profit of $45 million, up 17.4% from a year ago. That news was released to the market a month ago now. Note how it has reacted to that news.

According to AHG managing director Bronte Howson, the stimulus is coming through in lower fuel prices and continued lower interest rates.

AHG is also involved in the temperature-controlled long haul transport, cold storage, and refrigerated distribution business. The company recently acquired Scott’s Refrigerated Freightways. This is expected to support earnings over the next six months according to managing director Bronte Howson.

The chart is perhaps confirming all that, as it’s broken over three prior minor highs; it’s a company one could follow now.

What Now for Automotive Holdings Group Ltd?

The company directors have declared a fully franked dividend of 9 cents per share, the record date is 16 March, so this is something we must be mindful of. See how it reacts to the ex dividend date today; you would expect the shares to be sold down today.

However, if it recovers strongly from ex dividend selling, it is only a short drive to all-time new highs. If it should take out all time new highs, that will tell you something, not only about AHG Ltd, but also for new car sales and more broadly for the economy at large. Of course, you will understand all that if you can read a chart. Go here to find out how. Let’s wait and see what unfolds.

Terence Duffy,
Research Analyst, Cycles, Trends and Forecasts

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