Analysis: Auto Parts Stocks Should Recover in 2018
Jan. 11, 2018—While last year was nothing to write home about for auto-parts retailers—considering highly regarded stocks such as O’Reilly Automotive's declined as much as 14 percent—analysis from the Associated Press suggests that parts stocks are likely to recover in 2018.
The parts sector appears set for a comeback in the following year due to several factors. A combination of the Trump Administration’s tax bill, improving economic growth, improvement in the jobs market, and moderating growth in gas prices should lead to relative improvement in miles driven, the Associated Press noted.
Another positive for the parts world: the average age of a car in the U.S. keeps increasing.
Ultimately, the new year could very well improve investor sentiment toward the Advance Auto Parts and Genuine Parts Company’s of the automotive world.
The long-term outlook remains positive for the sector, and impacts from online outlets like Amazon are likely overstated, the Associated Press wrote.