Five interesting things that Hodges Capital research analysts discovered this week...
#1 TOTALED VEHICLES: According to LexisNexis Risk Solutions and Axios, insurance claims for totaled vehicles have increased significantly over the past five years. In 2018, only 19% of vehicles were deemed totaled, compared to 27% in 2023. The primary factors driving this trend are the rising costs of advanced vehicle software, supply chain disruptions, and longer vehicle lifespans.
#2 BUSINESS CONFIDENCE: According to the NFIB survey, small business optimism fell 2.1 points in February to 100.7, as economic policy uncertainty appears to be delaying long-term business decisions. While this survey can fluctuate quickly, it is widely regarded as a reliable gauge of middle-income consumer spending trends.
#3 DEFERRED MAINTENANCE: A recent survey conducted by William Blair, covering approximately 600 car owners, revealed near-term pressure on the auto service industry. The survey found that 40% of respondents defer both routine and non-routine vehicle maintenance to save money.
#4 MORTGAGE REBOUND: According to the Mortgage Bankers Association, mortgage applications increased by 11.2% for the week ending March 7, 2025. Purchase applications rose by 7%, while refinance applications jumped 16.2% from the previous week. This surge is attributed to the 30-year fixed mortgage rate dropping to 6.67% - its lowest level since October 2024 - encouraging both prospective homebuyers and homeowners seeking to refinance.
#5 CPI COOL-DOWN: According to the Bureau of Labor Statistics, inflation in the U.S. is beginning to cool. The Consumer Price Index (CPI) fell to 2.8% in February, down from 3.0% in January, just below the expected 2.9%. Core CPI inflation also declined, reaching 3.1% in February compared to 3.3% in January, slightly under the forecasted 3.2%. This marks the first decline in both headline and core CPI since July 2024.
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