Inside The Consumer Mind w/ Jeff Macke
The bad economy isn’t bad for everyone. In fact, Jeff Macke has spotted an area where fortunes are thriving because of the downturn.
We’re talking used cars. That’s right, we said used cars. Although total sales might be stuck in a rut, the average price of a used car has jumped about 8% in the last quarter, according to Bespoke.
We knew you’d find that one hard to believe so we found more evidence of the same. According to Manheim Consulting, in March, wholesale used vehicle prices increased for the third consecutive month; with wholesale values now up 8.3% for 2009.
No denying it; cheap is the new rich.
And when people need a new set of wheels, they’re turning their backs on the latest models – instead giving the green light to a car that’s like new. So, how should you trade the trend?
I think the trade is CarMax, says Jeff Macke. It’s a stock that continues to work. And also look at AutoZone, that’s a stock that’s also working. It’s a favorite of the shorts and it rarely misses.
AutoZone has doubled since October, counters Guy Adami. I wouldn’t race in, but I do like it on a pullback.
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Trader disclosure: On Apr. 15th, 2009, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Macke Owns (WFC), (AAPL), (WMT), (GS), (GE), (SDS), (GCI); Adami Owns (AGU), (C), (GS), (INTC), (MSFT), (NUE), (BTU) ; Finerman Owns (BAC) PreferredFinerman's Firm Owns (CTX), (MSFT), (RIG), ; (PBR), (UNH); Finerman's Firm Owns (BAC) Preferred; (WFC) Preferred; Finerman's Firm Is Short (BAC), (WFC), (MDY), (SPY), (USO); Najarian Owns (BX) Call Spread; Najarian Owns (C) Call Spread; Najarian owns (GS) Calls; Najarian Owns (INTC) Calls; Najarian Owns (JPM) Call Spread; Najarian Owns (PALM); Najarian Owns (RIO) Calls; Najarian owns (VAR) Call Spread; Najarian Owns (XHB) Call Spread
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