1 Great Car-Related Stock in a Booming Sector
Chip shortages have applied the brakes on revenue for many major automakers, but at least one related company is thriving amid 2020's and 2021's auto sector disruptions -- car part seller Genuine Parts Company (NYSE: GPC). The company posted excellent third-quarter (Q3) 2021 results on Oct. 21, prompting a share-price boost as traders responded positively. Zooming out to the bigger picture, Genuine Parts may have several more years of growth ahead, with conditions favorable to other sector companies, too.
The engine driving much of Genuine Parts' success, and that of similar companies, is the chip shortage causing a production bottleneck and dropping numbers of new passenger vehicles available, even as demand soars in the wake of COVID-19 lockdowns. Various analysts expect the shortage to continue until anywhere from mid-2022 to sometime in 2023. Car analytics firms J.D. Power and LMC Automotive worked together on a report showing a lack of new cars caused August 2021 sales to drop 13.7% year over year and plunge 25.3% since August 2019.
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Source Fool.com
