Analysts at Morningstar and Citi have given a positive reception to the recent acquisition of multiple car dealerships by Australia’s Eagers Automotive (ASX:APE) across Melbourne and Victoria.

Citi suggested that this strategic move will serve to counterbalance a predicted dip in earnings for Eagers in the 12 to 18 months ahead.

Following this, Morningstar increased their fair value prediction for Eagers by 6%, setting it at A$12.50 in the wake of this acquisition.

Projected revenue figures for the fiscal years 24 and 25 were also raised by Citi, with increments of 5% and 6% respectively, in light of the assumption that the takeover will be completed by February 2024.

The analysts at Morningstar anticipate that after this acquisition, Eagers will command about 12% of the market share.

In a survey of 15 analysts, eight rate the Eagers stock as ‘buy’ or higher, five opted for ‘hold’ and two for ‘sell’ or lower, with the average price target being A$15.38.

This year, the Eagers stock has seen a growth of 32% up until the most recent closing.

Eagers Automotive is an established entity in the automotive retail sector in Australia.