By Jeff Sanford
Toronto, Ontario — December 2, 2105 — Everyone in the auto claims economy knows the collision repair sector is larger than just the shops that do the repairs. A bevy of companies provide the paints, tools and products that experts use to repair cars. Many of these manufacturers are publicly traded companies. As a way of tracking the performance of the broader collision repair industry, Collision Repair magazine has created the Collision Repair magazine Stock Index, or CRM 11. You can find the constituent stocks listed in a Google sheet at CRM 11.
Over time we’ll be able to graph the performance of this index. For now let’s take a look at the performance of some of the companies that comprise the index. Some of the movers and shakers recently include the following:
– Major paint manufacturer Sherwin-Williams Company (NYSE:SHW) is trading down a bit over the last couple of weeks. But there has been a net inflow of money into the stock as it drops, suggesting investors are buying on the dip. Analysts at the investment bank owned by Royal Bank of Canada have just reiterated their rating on the stock, which is “outperform.” RBC Capital Markets has set a target price of $336 USD on its stock. From its current price this would be appreciation of over 20 percent.
– Shares in Auto Canada (TSX:ACQ) have fallen recently. The companies share price is down more than 10 percent, falling to about $27 from $31 a share. Investors have been spooked by weak earnings recently. It seems the company’s properties in Alberta have been a drag on performance (half of its properties are in that province). But while profits have fallen the company still netted $11.7 million in the most recent quarter. That is, the company is not losing money. Managment has announced the company plans to expand eastward. The company also just floated $75 million worth of new shares. Auto Canada is known primarily as an owner of dealerships but the company also processed 786,000 service and collision repair orders in 822 service bays over the last year, making them a major player in the repair space as well.
– LKQ Corporation (NASDAQ:LKQ) has suffered some selling pressure of late. Shares are down slightly. But investors are jumping in to buy on the weakness. A strong $20.03 million has flowed into the stock over the last couple weeks, including a massive single block trade of $14.3 million. Investors are buying on the dips. The company just announced a new board member, Robert M. Hanser. Hanser was recently the president of Automotive Aftermarket Division of Robert Bosch GmbH. So he’s got some good experience. According to the press release, under Hanser’s leadership, Bosch Automotive Aftermarket underwent a “fundamental change in strategy from a pure trading company to a comprehensive systems provider for the global workshop market.” Could he help oversee a similar shift at LKQ? We’ll see. “I have always admired LKQ for its innovative business model and strategy, and dynamic leadership team, and I’m honored to be joining their board,” Hanser was quoted as saying.
– Shares of AkzoNobel (OTC:AKZOY) now sport an average rating of “Buy” from the analysts following the company. The average 1-year price target is $27.00.
– Shares of Axalta Coating Systems (NYSE:AXTA) continue to do well. The company is off the highs it hit over the summer, but it has risen by almost 2 percent in just the last week and almost 7 percent over the last month. Year-to-Date the stock is up almost 25 percent over the last year. This performance beats the S&P 500. The company seems to be a darling of large institutional investors such as pension funds. Institutional investors hold 98.85 percent of Axalta shares. Insiders hold the majority of the rest. The company has just been certified as a “Premium Partner” by Mercedes-Benz aftermarket in China.
