The ASX All Ordinaries Index (ASX: XAO) is climbing higher again today, up 0.58% at the time of writing. Over the past six months, the index has climbed 7.71%, and a good chunk of that growth has been driven by the automotive sector.
In a recent note to investors, Macquarie Group Ltd (ASX: MQG) has highlighted its top automotive picks for strong growth.
Amotiv Ltd (ASX: AOV)
The Amotiv share price is climbing higher at the time of writing on Thursday morning. The share price is up 0.74% and changing hands at $9.57 a piece.
For the year, the company's share price is 4.4% lower thanks to a sudden 21% nosedive in early April when the reciprocal US tariffs were announced. Since then, the owner of automotive aftermarket brands has recouped the majority of losses.
Macquarie is positive on the stock's outlook. The broker has an outperform rating on the shares and a target price of $11.66. That's a potential upside of 21.8% for investors over the next 12 months, at the time of writing.
ARB Corp Ltd (ASX: ARB)
ARB's share price is also in the green this morning. At the time of writing, the shares are up 0.61% to $39.105 each. Like Amotiv, ARB's share price is 3.49% lower for the year, also due to a share price drop on the US tariff announcement in April.
Macquarie has an outperform rating on the auto accessories company's shares, and a 12-month target price of $44.90. At the time of writing, that's a potential 14.8% increase for investors.
What else does Macquarie have to say?
Market volumes in August were up 2.9% year-on-year to 103.7k, bringing calendar year-to-date volumes down by 0.5%, the broker explained.
"We expect new vehicle demand will continue to improve and expect 2HCY25 volumes will be up low to mid single digits, supported by 1) easier comps (2HCY24 -4.9%); 2) potential for further rate cuts; and, 3) housing price growth. This would see CY25 volumes flat to down low single digits."
August saw stronger volumes in the Prado, Triton, and Hilux, while the Ranger, D-Max, BT, Landcruiser, and Navara declined over the month.
The 4×4 index benefited from a 2,000 vehicle swing in the Prado, which registered only 3 vehicles in the prior corresponding period. This drove Macquarie's 4×4/ARB Index 6.7% higher year on year, while the APG/AOV Index declined -9.9% over the same period.
"For 1H26e YTD (Jul +Aug), 4×4 volumes are up +6.8% yoy and down -7.4%, with >20% reductions across Outback, Navara, Outlander, Rav4. We have an OP on AOV and ARB. AOV's val is attractive (~11x FY26e PE) with achievable FY26 guidance, and we remain positive on ARB's offshore growth opportunities that showed acceleration of growth at the recent result (~30x FY26e PE)."
