Used sales up 45%

**JABIII** · 07-28-2021, 06:27 AM

TRADING NATION
One corner of the auto market is hitting records as used car prices surge

JUL 28 2021
Keris Lahiff

A global chip shortage has put the squeeze on car production and driven the price of used cars higher.

Used car and truck prices rose by more than 45% in June, according to the most recent read on inflation.

That looks to have had a knock-on effect among auto stocks with repair and tune-up plays gaining favor among investors. Advanced Auto Parts, AutoZone, AutoNation and O’Reilly Automotive hit record highs in the past week.

Raymond James also weighed in on the group on Tuesday. Analysts upgraded Advance Auto Parts to a strong buy, saying its turnaround story is paying off, while downgrading AutoZone to a still bullish outperform rating.

The firm also said O’Reilly should continue to take market share thanks to its “leading supply chain capabilities” and robust cash flow, though it downgraded the stock to a market perform on expectations of a softer longer-term outlook relative to its history.

Nancy Tengler, chief investment officer at Laffer Tengler Investments, backs O’Reilly as her top pick in the space.

“That’s how we want to play the used car market,” Tengler told CNBC’s “Trading Nation” on Tuesday. “If you’re a long-term investor and you own O’Reilly, for example, you want to hang on to that.”

O’Reilly has risen 11% in the past month. The stock hit a high as recently as Monday.

Miller Tabak chief market strategist Matt Maley is also bullish on the group for the long term.

“The stocks continue on a technical basis to make nice higher lows and higher highs, including a nice higher high just recently,” Maley said during the same interview. “Both those things bode well on a long-term basis.”

But, after such strong performances this year, Maley is a little more cautious over the short term.

“If you look at their weekly RSI charts, relative strength index, they are getting overbought. So therefore, although you can continue to nibble at them here, you should wait to be aggressive until they pull back a little bit,” Maley said.

AutoZone, AutoNation, Advance Auto Parts and O’Reilly all trade with a weekly RSI reading above 65. Any reading above 70 is generally considered an overbought condition.

Disclosure: Laffer Tengler Investments hold ORLY.

https://www.cnbc.com/2021/07/28/stoc...his-month.html

**willk** · 07-28-2021, 06:31 AM

A buddy of mine just traded in his truck for $8,000 more than what they were offering him a year-and-a-half ago. I know another guy who bought a truck 2 years ago and the dealership called him and tried to buy it back for $6,000 more than he paid for it.

**bitesize** · 07-28-2021, 06:38 AM

All is well until new cars rebound and inventory comes back. You will see steep discounts and then you will have an ocean of upside down car notes. Anybody paying new car pricing on a used car is an idiot.

Cheap debt is still debt!

**Whackumstackum** · 07-28-2021, 07:08 AM

Originally Posted by bitesize

All is well until new cars rebound and inventory comes back. You will see steep discounts and then you will have an ocean of upside down car notes. Anybody paying new car pricing on a used car is an idiot.

Cheap debt is still debt!

It always comes full circle but for now it’s wild with no slowing down in sight.

**2thDoc** · 07-28-2021, 07:09 AM

i am looking for a car for my daughter. while I understand the "you're an idiot for paying that price", what is my option?

**JABIII** · 07-28-2021, 07:10 AM

**ecwooduck** · 07-28-2021, 07:10 AM

I've got a 2015 Chevy Silverado Crew Cab LT that I paid 33K for new. I've put 110K miles on it and the dealer just offered me 30k for it the other day. The same dealer offered me 18K for it about a year ago with 85K miles on it.

**darealdeal** · 07-28-2021, 07:14 AM

It will fall just as the housing market will. Same happened maybe not with cars but with homes in 2008. Some can't get approved for a dang credit card but can go down the road and get a loan for a home outside of his or her price range.... A lot of people are going to be hurting once all these "no evictions" "no foreclosures" start to go away..... The flip side is a lot of people stand to make some money if you can time it right and find the bottom....

**darealdeal** · 07-28-2021, 07:15 AM

Originally Posted by 2thDoc

i am looking for a car for my daughter. while I understand the "you're an idiot for paying that price", what is my option?

Bike...

**bitesize** · 07-28-2021, 09:42 AM

Originally Posted by 2thDoc

i am looking for a car for my daughter. while I understand the "you're an idiot for paying that price", what is my option?

I painted a broad stroke with that statement- I’m referring more to the folks that are buying the 2-3 yr old truck with 80k miles paying new car pricing with a 10yr note. Just because your payment is the same doesn’t mean you are getting a good deal! Bigger problem is when Ford, GM slash new car prices to balance their books and your 2-3 yr old truck loses 40-50% of its value over night.

**Duck Nitz** · 07-28-2021, 10:03 AM

Originally Posted by JABIII

that is so rich

**Duck Nitz** · 07-28-2021, 10:04 AM

In 3 months, it will turn around. New inventory on the lot will end the madness. Hopefully.

**Remy** · 07-28-2021, 10:31 AM

The only 2 cases I can think of where it would be prudent to buy a car/truck right now is if yours just blew up and is beyond repair or if you are like the tooth man and have to buy one for a new driver. I'd refuse to pay $35k plus for a 5 year+ old truck with over 80k miles

**BigBrother** · 07-28-2021, 11:27 AM

I am trying really hard not to sell my truck (now that I have it just the way I want it), buy a beater and buy new when the backlog floods the market.

**2thDoc** · 07-28-2021, 11:29 AM

jabs pic made me lol

cola people near the VA, check out united auto sales on the corner. sweet jacked up white truck in the lot. I keep telling my daughter it might be hers soon....

**2thDoc** · 07-28-2021, 11:30 AM

546111-2019-RAM-250019.jpg

**darealdeal** · 07-28-2021, 11:45 AM

Originally Posted by Duck Nitz

In 3 months, it will turn around. New inventory on the lot will end the madness. Hopefully.

Hard to tell exactly. A lot depends on the spending bill. Never in history has this much money just came out of thin air. Hard to tell how it will effect the market let alone how long it will effect the market.

2th you should buy that and slap some advertisement on the side. You would be the coolest dentist this side of the Mississippi.

**SaltMuck** · 07-28-2021, 12:13 PM

Trade in on my 2020 appreciated $7,000 with 25k miles. Crazy times…

**Tugted312** · 07-28-2021, 12:24 PM

Originally Posted by 2thDoc

i am looking for a car for my daughter. while I understand the "you're an idiot for paying that price", what is my option?

Was in the same boat for oldest going to college. Had the car he wanted in February but we didn’t need it then. Plan was to wait until graduation. We waited & the shortage happened. We looked all over SC, Ga, Fla, & NC. Ended up getting a certified pre owned 2018 with 11500 miles on it some lady didn’t drive the last year cause of Covid. Had to drive to Cary NC to get it thou. Price was a little higher then we expected but not bad.