Barclays lowers automotive retailer expectations, releases report ahead of Q1 earnings season

LootboxPhobia · 2026-04-06T17:15:48+00:00

Investing.com -- Barclays lowered the expectations for most auto dealerships ahead of the Q1 2026 earnings season, citing weak U.S. auto sales and the potential impact of tensions in the Middle East on the sector.U.S. auto sales declined 5.3% year-over-year in the first quarter, whereas Barclays previously forecasted an average decline of 3.8% for dealerships. The bank also cut its growth outlook for parts and service businesses by 50 to 200 basis points due to winter storms in January and February, though it still expects low to mid-single-digit positive growth.Barclays raised the ratio of sales and administrative expenses to gross profit for dealerships, mainly reflecting the impact of sluggish new car sales. The bank noted that, given the weak performance of dealership stocks in the first quarter, companies may have engaged in share buybacks.For Carvana Co.(NYSE:CVNA

LootboxPhobia

2026-04-06 17:15:48

Investing.com – Barclays has cut expectations for most auto dealers ahead of the 2026 first-quarter earnings season, citing weak U.S. auto sales and the potential impact of tensions in the Middle East on the sector.

U.S. first-quarter auto sales fell 5.3% year over year, while Barclays previously expected the average decline for dealers to be 3.8%. The firm also lowered its growth outlook for parts and service by 50 to 200 basis points, citing winter storms in January and February, though it still expects low-to-mid single-digit positive growth.

Barclays raised its outlook for the sales and management expense-to-gross profit ratio for dealers, mainly reflecting the impact of soft new-vehicle sales. The firm said that, given dealers’ weak stock performance in the first quarter, the company may have conducted share buybacks.

For Carvana Co. (NYSE:CVNA), Barclays raised its first-quarter outlook. Previously, data science team tracking showed unit sales up 37.4% year over year, higher than the prior expectation of 23.5%. The firm also slightly raised its forecast for retail gross profit per vehicle.

Based on the latest data, CarMax (NYSE:KMX) unit sales tracking for its fourth fiscal quarter through February fell 1.9%. The company plans to release its earnings report on April 14.

Barclays cut its outlook for Copart (NASDAQ:CPRT) for the third fiscal quarter to reflect the impact of tensions in the Middle East, which could significantly reduce volumes. In fiscal year 2025, about 39% of CPRT’s U.S. vehicle sales went to international buyers, including more than 28% of used passenger car exports headed to the Middle East region.

The firm said that a sharp rise in fuel costs could have a modest impact on companies such as LKQ (NASDAQ:LKQ), Carvana Co., CarMax, and Openlane (NYSE:KAR), but overall exposure and the timing of the fuel price increases should limit the extent of the impact.

This article was translated with the assistance of artificial intelligence. For more information, please see our Terms of Use.

View Original

This page may contain third-party content, which is provided for information purposes only (not representations/warranties) and should not be considered as an endorsement of its views by Gate, nor as financial or professional advice. See Disclaimer for details.