The share price of AP Eagers Ltd (ASX: APE) has climbed higher this morning after the automotive retail company released a positive half-year update to the market.

Much to the delight of its shareholders the update reveals that AP Eagers is expecting a record profit result for the half year ended June 30 2016. It expects a 14% increase in net profit before tax of approximately $67.8 million, compared to $59.5 million for the corresponding period in 2015.

Although the share price is climbing higher slightly, I feel the market wasn’t too surprised and was largely expecting a strong first half following the company’s market update in May. That update revealed that the first four months of the year had seen both revenue and profit up by 9% year on year.

This record result is no doubt thanks partly to AP Eagers’ aggressive growth through acquisition strategy. In fact, just last month the company announced it had agreed on yet another acquisition. AP Eagers has agreed to acquire the Tony Ireland Group, which is a Townsville-based car and trucking retail business selling Holden, HSV, Land Rover, Jaguar and Isuzu Trucks, and Hyundai Forklifts brands. Management expects the acquisition will close in the third quarter and be accretive to earnings in FY 2017.

Whilst this type of acquisition strategy can turn sour if executed poorly, AP Eagers’ management has been doing it successfully. This has seen the company not only produce years of strong earnings and dividend growth, but also win market share from its competitors.

This for me makes it a great investment at the right price. But right now the shares are looking a touch expensive in my opinion. At 23x trailing earnings its shares are trading at a premium to rival Automotive Holdings Group Ltd (ASX: AHG) and the rest of the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO)

Shares of Automotive Holdings Group (which AP Eagers owns a 19.9% stake in) are changing hands at just under 14x trailing earnings. In light of this, I would favour an investment in Automotive Holdings Group over AP Eagers today, especially when you take into account its fully franked 5.2% dividend.

Lastly, if you plan on adding either of these shares to your portfolio then I would highly recommend you check to see if you own one of these three rotten ASX shares. Each could be harming your portfolio, so might be better off out if you ask me.

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Motley Fool contributor James Mickleboro has no position in any stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.