April 23, 2010 – Autonation Predicts a Big Recovery in Car Sales…and Platinum and Paladium

Featured Trades: (AN), (TM), (PPLT), (PALL)


1) Autonation Predicts a Big Recovery in Car Sales….and Platinum and Paladium. The performance of AutoNation (AN), the largest car retailer in the US, is a great leading indicator for the global economy and is to be ignored at your peril. Q1 revenues soared by a blistering 21% across every category, segment and geographic location. Buyers piled on $1,000 in extras per vehicle. This was all happening in the face of a 12% reduction in incentives, so auto maker margins are exploding. Toyotas (TM) were flying off the lots, not because of brake problems, but because of a massive wave of buyers snapping up the once in a lifetime discounts, delivering an amazing 38% pop in sales. Those who heeded my call to buy the stock of this best of breed company (click here for the call) were richly rewarded. The rise of this industry, phoenix like from the ashes, was made possible by a rebirth of the credit markets, with $13 billion in securitizations in the quarter. Of course, the prices of platinum (PPLT) and palladium (PALL) were telling you this miraculous recovery was on the way (click here for the call). Stock investors have not been blind to this comeback, taking AN’s stock up 550% from the dark days of October, 2008.

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