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Asbury Automotive Group, Inc. (ABG): LionEye Increases Stake Amid Strong Financial Results

Stephen V. Raneri‘s LionEye Capital Management has further upped its stake in Asbury Automotive Group, Inc. (NYSE:ABG), as a new filing with the US Securities and Exchange Commission Showed. The fund currently holds around 2.15 million shares of the company, the activist stake amassing 7.2% of the company’s outstanding common stock. The position also includes 330,000 shares underlying ‘Call’ options. Previously LionEye held around 1.89 million shares of Asbury Automotive Group.

Asbury Automotive Group Inc (ABG)

LionEye raised its position to Asbury Automotive Group, Inc. (NYSE:ABG) only around a month after it revealed surging its stake from 1.02 million shares held as of the end of June. In the meantime, the stock of the company slightly picked up, adding around 1.50%. LionEye initiated a stake in Asbury Automotive during the first quarter, holding initially only 126,150 shares and upping the stake by a sevenfold during the April-June period, during which, Asbury Automotive Group, Inc. (NYSE:ABG) became the largest long equity position in LionEye’s equity portfolio. The stock gained around 23% year-to-date. although it slightly fell since the end of the second quarter. Asbury sports a P/E of around 16.00, which is below the industry average of around 18.70. Nevertheless, the company performed better than some of its peers among mid-cap automotive retailers in terms of stock price. Lithia Motors Inc (NYSE:LAD) and America’s Car-Mart, Inc. (NASDAQ:CRMT) picked up around 4% year-to-date, while Sonic Automotive Inc (NYSE:SAH) lost approximately 4% for the same period.

In this way, investors have been showing their interest in Asbury Automotive Group, Inc. (NYSE:ABG). Only a couple of days ago, Brian Jackelow‘s SAB Capital Management reported a new position in the company, which amasses 1.68 million shares, equal to 5.7% of the company. As of the end of June, Glenn Fuhrman and John Phelan’s MSD Capital and Ricky Sandler’s Eminence Capital hold 2.38 million shares and 2.12 million shares respectively.

Some investors have also been actively trading their shares of Asbury Automotive Group, Inc. (NYSE:ABG). In particular, the President and CEO of the company Craig Monaghan sold around 88,000 shares this year, currently owning around 109,000 shares.

LionEye raised its stake after the company released solid financial results for the third quarter of the year. The revenue went up by 8% on the year and totalled $1.5 billion, while its net income increased to $1.08 per share from $0.73 per share. However, while the revenue was in line with the estimates, Asbury Automotive Group, Inc. (NYSE:ABG) slightly missed the consensus for EPS, which was standing at $1.10. For the full year, analysts expect the company to report revenue of $5.8 billion and EPS of around $4.30.

Disclosure: none

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