Kerrigan Auto Retail Index indicates auto retail stocks reacting positively to Trump election, outperforming S&P by 240.9%

Irvine, CA, December 1, 2016 – Kerrigan Advisors today announced that The Kerrigan Auto Retail Index was up 11.66% in the month of November, significantly outperforming the broader S&P 500 Index by 240.9%.  With no earnings announcements or other major industry events, The Kerrigan Auto Retail Index attributes the rise to the election of Donald Trump.  

“While the Trump administration is still in formation, we believe stocks are reacting to key themes which portend strong auto sales,” said Erin Kerrigan, Managing Director of Kerrigan Advisors.  “First amongst these is Trump’s stated focus on domestic job creation as well as his advocacy for aggressive spending on infrastructure, including roads, bridges and ports, which could increase employment and add to commercial vehicle demand. In addition, we believe the index is reacting positively to his proposals to stimulate the economy with tax cuts.” 

The Kerrigan Auto Retail Index, which is a monthly index for the auto retail industry covering the seven publicly traded auto retail companies with operations focused on the US market, shows the following key trends in the month of November:

• The Index rose 11.66% overall in November
• The Index outperformed the broader S&P 500 Index, which increased 3.42% 
• Each of the seven component stocks in the index were up in November
• Four of the stocks up over 15% for the month
• Group 1 Automotive posted the strongest gain with an increase of 20.44%, followed by Sonic Automotive (+18.16%), CarMax (+15.72%) and Asbury Automotive Group (+15.31%)

“More specific to auto retail, the incoming Trump administration is assumed to be more business-friendly, and could slow, if not disband, regulatory initiatives such as the Consumer Financial Protection Bureau (CFPB) and increased CAFÉ mileage requirements, both moves seen as highly positive to auto retail,” continued Ryan Kerrigan, Managing Director of Kerrigan Advisors.

The Kerrigan Auto Retail Index is designed to help public and private auto retailers understand the true value of their dealerships, while also providing key insights into factors influencing valuations of these public companies, with broader implications for the auto industry as a whole. To access the Kerrigan Auto Retail Index, click here.

Kerrigan Advisors also releases The Blue Sky Report™ four times a year and includes Kerrigan Advisor’s signature blue sky charts, multiples and analysis for each franchise in the luxury and non-luxury segments. The multiples are based on Kerrigan Advisors’ view of franchise values in the current buy/sell market and can be applied to adjusted pre-tax dealership earnings to estimate blue sky value. To download The Blue Sky Report, click here.

Erin Kerrigan is Managing Director of Kerrigan Advisors, and is a recognized industry expert on dealership valuation, real estate and buy/sells. A sought after commentator on automotive retailing topics ranging from consumer auto buying trends to auto retail consolidation to private equity in auto retail, she has keynoted numerous automotive conferences and her analysis has appeared in publications such as Automotive News and the Wall Street Journal.   For a recent video of Erin’s commentary on the market, click here.

Ryan Kerrigan is Managing Director of Kerrigan Advisors and an expert on US auto retail buy-sell transactions. Ryan served as Managing Director at Serent Capital, a $250mm private equity fund investing in middle market companies. Prior, he briefly served as General Manager of the family’s auto dealership. Mr. Kerrigan began his career as a management consultant at McKinsey & Company, where he advised Fortune 500 companies on growth strategies, organizational issues, pricing and business valuation.

About Kerrigan Advisors

Kerrigan Advisors is a national dealership buy/sell advisory firm focused on providing a high level of client service for dealership sellers. Led by a team of veteran advisors who have represented transactions totaling over $2 billion dollars in automotive, private equity and investment banking, Kerrigan Advisors customizes each sale process to maximize the seller’s transaction proceeds. With the most comprehensive buyer database in the industry, Kerrigan Advisors has the industry context and expertise to match each seller with the right buyer.

In addition to the monthly Kerrigan Auto Retail Index, each quarter, Kerrigan Advisors publishes The Blue Sky Report™, a Kerrigan Quarterly, which is the auto industry's most comprehensive and authoritative quarterly report and analysis of dealership buy/sell activity and franchise values.  Kerrigan Advisors’ Managing Director Erin Kerrigan, who authors the report, is a recognized industry expert on dealership valuation, real estate and buy/sells, and is a frequent speaker at leading auto retail events and conferences, including NADA, JD Power Automotive Roundtable, AICPA, NADC and Driving Sales’ President’s Club. She has also been a keynote speaker for events hosted by American Honda Motor Company, Audi of America, US Trust, Ohio Automobile Dealer Association, and SunTrust Bank and has led webinars for NADA and Automotive News.  Her expertise is also featured in a monthly column for Dealer Magazine. 

Kerrigan Advisors Media Contact:
Melanie Webber (melanie@mwebbcom.com), mWEBB Communications, 424.603.4340

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Unengaged wait time in the dealership outpaced negotiation as the biggest consumer pain point in the car buying process, according to eLEND Solutions 2016 Dealer Survey

Foothill Ranch, CA –November 29, 2016 – For the third year in a row, a survey of auto dealers, fielded by eLEND Solutions™, shows a distinct disconnect between actual start-to-finish transaction times and what dealers believe is the “ideal” time consumers should spend in a dealership buying a car.

*includes % saying under an hour

While transaction times reported by dealers show a marked improvement over previous years, well over half still have a process that takes over two hours.  The culprits? Dealers cited transition time from Sales to F&I as the biggest slowdown and agreed that the time it takes to complete the F&I portion of the car buying process is the biggest obstacle to CSI success: over half reported that wait time, either in F&I or the dealership, constitutes the number one pain point for consumers. And, while nearly two-thirds cite improvements in the finance process as having the greatest potential positive impact on transaction times (getting F&I involved sooner, better real time data exchange, etc.), over 50% of respondents do not pull credit reports until well into the sales process.

“We are pleased to see that transaction times are improving for some dealerships, but this continues to be a pain point for many dealers, costing them significant dollars in resources and lost opportunities,” said Pete MacInnis, CEO of eLEND Solutions, Inc.

MacInnis cited a recent case study of a dealership that achieved significant transaction time improvements by streamlining sales and F&I as a proof point of the dollar benefits that come from reducing transaction times. By pre-qualifying customers at the start of the transaction, the dealership knocked approximately an hour off the transaction time, which resulted in increased gross profits per car sold of  $300+, while saving as much as $275 on variable labor and other costs, and generating a four point increase in CSI.

Key Survey Highlights:

Transaction times improve, but don’t meet dealer goals

While dealers are still not meeting their ideal goals, transaction times have improved according to the snapshot survey. In 2014, 40% of dealers reported an over three hour process while in 2016, only 25% of dealers surveyed said their process took over three hours.

Over a third of dealers surveyed think the start-to-finish process should take under an hour, but only 11% of dealers overall say they are able to achieve that. For dealers who specify under an hour as an ideal time, the number of those dealers achieving it doubles to 22% (and rises to 55% for those whose ideal time is under two hours), indicating that targeting a shorter transaction time ultimately leads to shorter transaction times.

Wasted time in dealership is biggest consumer pain point

Unengaged wait time in the dealership outpaced negotiation as the biggest consumer pain point at the dealership, according to the dealers surveyed – with time spent in F&I cited as the top pain point by one in four dealers. Nearly 60% of dealers indicate wasted consumer time is potentially their biggest CSI issue.

F&I needs connected process to streamline wait times

Seventy-three percent of those surveyed agree that the greatest obstacle to success in F&I and CSI is the time it takes to complete the F&I portion of the car buying process and 63% cite the transition from Sales to F&I, and time spent in F&I, as the biggest slow downs. “These are symptoms of the ‘silo’d’ sales and F&I process,” continued MacInnis. “If information flow were consistent and uninhibited across departments, a connected car buying process would be facilitated, time in F&I would be reduced, and the overall transaction times would accelerate.”

Are dealers waiting too long to pull credit?

Of dealer respondents who say they pull credit, over half wait to pull credit until well into the purchasing process.

“We believe that pulling credit sooner is a critical – and simple – step to streamlining the process and achieving better CSI and higher closing ratios,” said MacInnis.

Dealers united

The snapshot survey, conducted online among dealerships nationwide in October 2016, also showed that dealerships are united on the idea that increasing CSI means greater sales and profit (91%) and on the goal of connecting the online and in-store process (69%).

About eLEND Solutions
eLEND Solutions is a privately held technology company whose patented platform offers integrated credit, identification and finance solutions that enable a connected buying experience for consumers and a streamlined sales and finance workflow for dealers and lenders that reduces the time to complete a vehicle purchase transaction by hours.  For more information, visit www.elendsolutions.com.

Contact: 
Media Relations 
Melanie Webber, mWEBB Communications, (424) 603-4340, melanie@mwebbcom.com 
Crystal Hartwell, mWEBB Communications, (714) 987-1016, crystal@mwebbcom.com

Dealership M&A Activity Declines in Third Quarter; 2017 Increases Likely, according to The Blue Sky Report™ released by Kerrigan Advisors

Pace of acquisitions slow for balance of 2016; incoming Trump administration motivating sellers to push closings to 2017, while more foreign investment anticipated next year

Irvine, CA, November 22, 2016 – Dealership M&A activity declined by 7% in the first nine months of 2016 YOY, with sellers likely to push closings to 2017 in anticipation of potential tax benefits from the incoming Trump administration, according to analysis from the Blue Sky Report™, a Kerrigan Quarterly, which was released today.  Overall, premium pricing declined in the first nine months of the year, but buy/sell activity remained strong with a 32% increase in the number of multi-dealership groups selling in the first nine months of 2016.

Today’s Blue Sky Report, published by Kerrigan Advisors, is the auto industry's most comprehensive and authoritative quarterly report and analysis of dealership mergers and acquisition activity and franchise values. It includes analysis of the first nine months of 2016 - laying out the high, average and low blue sky multiples for each franchise in the luxury and non-luxury segments for the quarter - and offers a detailed view of public and private company dealership acquisition activity.  

Key data and analysis from the report includes:

• 172 dealership buy/sell transactions completed in the first 9 months of 2016[1] versus 184 transactions in the first 9 months of 2015. 
• Buy/sell activity declined slightly in the 2nd and 3nd quarter, resulting in a 7% decline year-to-date. 
• Pace of acquisition activity is not likely to increase in balance of 2016.
• Transaction sizes are rising and multi-dealership groups are coming to market at an increasing pace. 
• For the third quarter of 2016, Kerrigan Advisors’ average blue sky multiples remained relatively stable.
• While premium pricing of auto dealerships is on the decline, most buyers are willing to acquire dealerships within Kerrigan Advisors blue sky multiples. 
• The auto retail markets made a dramatic shift to high margin trucks and SUVs, driven by low gas prices. 

“Buy/Sell activity remains strong but, with the expectation of a tax reduction from the Trump Administration, 4thquarter activity could decline as sellers hope for a more favorable tax rate on their sales proceeds in 2017,” said Erin Kerrigan, Managing Director of Kerrigan Advisors.

The report identifies three key trends moving forward into 2017:

• Auto retail’s hedged business model sustains dealership profitability.
• Economies of scale and scope drive consolidation.
• Foreign interest in US auto retail rises.

“A trend we are watching closely for 2017 is the entry of foreign investors into the market,” continued Kerrigan.  “Because international companies are attracted to the franchise protections afforded to US auto dealerships and are seeking geographic diversification beyond their borders, we expect foreign investors to make their mark on 2017 with at least one or two completing sizable acquisitions.”

Kerrigan Advisors is deeply involved in the Buy/Sell Market having sold two of the top 100 dealership groups, Sam Swope Auto Group and the Carbone Auto Group, in the last 12 months and is currently engaged to sell two additional top 100 groups.  Kerrigan Advisors extensive experience representing the largest dealership groups in the country provides the firm with a unique perspective on the trends shaping the industry and today’s franchise values. 

The Blue Sky Report™, a Kerrigan Quarterly, is published four times a year and includes Kerrigan Advisor’s signature blue sky charts, multiples and analysis for each franchise in the luxury and non-luxury segments. The multiples are based on Kerrigan Advisors’ view of franchise values in the current buy/sell market and can be applied to adjusted pre-tax dealership earnings to estimate blue sky value. To download the report, click here.

Kerrigan Advisors also releases a monthly index, The KAR Index, composed of the seven publicly traded auto retail companies with operations focused on the US market.  The KAR Index is designed to track dealership valuation trends, while also providing key insights into factors influencing auto retail. To access the KAR Index™, click here.

Erin Kerrigan (www.kerriganadvisors.com/meet-the-team-2/) is Managing Director of Kerrigan Advisors, and is a recognized industry expert on dealership valuation, real estate and buy/sells. A sought after commentator on automotive retailing topics ranging from consumer auto buying trends to auto retail consolidation to private equity in auto retail, she has keynoted numerous automotive conferences and her analysis has appeared in publications such as Automotive News and the Wall Street Journal.   

About Kerrigan Advisors

Kerrigan Advisors is a national dealership buy/sell advisory firm focused on providing a high level of client service for dealership sellers. Led by a team of veteran advisors who have represented transactions totaling over $2 billion dollars in automotive, private equity and investment banking, Kerrigan Advisors customizes each sale process to maximize the seller’s transaction proceeds. With the most comprehensive buyer database in the industry, Kerrigan Advisors has the industry context and expertise to match each seller with the right buyer.

Each quarter, Kerrigan Advisors publishes The Blue Sky Report™, a Kerrigan Quarterly, which is the auto industry's most comprehensive and authoritative quarterly report and analysis of dealership buy/sell activity and franchise values.  Kerrigan Advisors’ Managing Director Erin Kerrigan, who authors the report, is a recognized industry expert on dealership valuation, real estate and buy/sells, and is a frequent speaker at leading auto retail events and conferences, including NADA, JD Power Automotive Roundtable, AICPA, NADC and Driving Sales’ President’s Club. She has also been a keynote speaker for events hosted by American Honda Motor Company, Audi of America, US Trust, Ohio Automobile Dealer Association, and SunTrust Bank and has led webinars for NADA and Automotive News.  Her expertise is also featured in a monthly column for Dealer Magazine. 

Kerrigan Advisors Media Contact:

Cassandra Cavanah (cassandra@mwebbcom.com), mWEBB Communications, 818.397.4630
Melanie Webber (melanie@mwebbcom.com), mWEBB Communications, 424.603.4340

“Gubagoo’s RESQ’s technology is all about saving dealerships time and money, while increasing their opportunity from lead to sale,” continued Title. “RESQ goes wherever the dealership sales team goes, keeping them connected 24/7 to not only ‘rescue sales’ but, now, provide any customer the information they need.”

RESQ also provides support to the service department, pushing real-time calls from customers to service advisors’ mobile phones wherever they may be on the shop floor. Together with Gubagoo’s TalkSmart and ChatSmart, RESQ can send push notifications to any salesperson or service advisor’s mobile phone, notifying them that a customer needs assistance. In return, the service advisor or sales team member, on their mobile phone, is able to ‘whisper’ back to the Gubagoo operator, giving direction, or seamlessly requesting the call or chat to be handed over to them and take control of the conversation from any location.

RESQ technology is both desktop and mobile and available for iOS, Android and web browsers.

Gubagoo, one of the fastest growing and most effective chat and website engagement providers for automotive dealerships, tracks and scores over 18 million shoppers every month through its B.E.A.S.T. scoring technology and sends over 110,000 leads to dealerships every month. The integration of RESQ into Gubagoo further boosts the effectiveness of the company’s ChatSmart and TalkSmart products.

Gubagoo is demonstrating the new RESQ features at DrivingSales Executive Summit in Las Vegas, October 23th – 25th.

 About Gubagoo

Based in Boca Raton, Gubagoo is the leading provider of dealer live chat, text, and call solutions. Gubagoo offers seamless integrated web-based, SMS, and call monitoring technologies for automotive dealerships. Our passion for customer service and lead conversion, makes Gubagoo the best 24/7 car dealer chat, text, and overflow call provider in the automotive industry. Gubagoo’s U.S. based operators, receive the highest level of training and certification to make certain every customer that engages in a live chat, text, or call, receives the best possible customer experience. Gubagoo delivers the best quality of service to automotive dealership customers and strives to maximize the dealership’s lead conversion rate and long-term auto sales. For more information about Gubagoo products, visit www.gubagoo.com or contact 855-359-2573.

Gubagoo Media Relations

mWEBB Communications, Melanie Webber, (949) 307-1723, melanie@mwebbcom.com

Multi-Franchise Dealership Transactions Rise by 52% in First Half of 2016 according to The Blue Sky Report™ released by Kerrigan Advisors

Despite a slight decline in overall transaction activity, average transaction size is up; record franchise values and rising real estate prices spur more sales by family-owned dealerships; domestic transaction buy/sell share increases

Irvine, CA, August 22, 2016 – The number of large, multi-dealership transactions rose by 52% YOY in the first half of 2016, according to The Blue Sky Report™, a Kerrigan Quarterly, which today released its analysis of the first six months of 2016.  Although there was a decline in overall transaction activity, the average size of transactions rose significantly. The report from Kerrigan Advisors is the auto industry's most comprehensive and authoritative quarterly report and analysis of dealership mergers and acquisition activity and franchise values.

Laying out the high, average and low multiples for each franchise in the luxury and non-luxury segments for the quarter, the report offers a detailed view of public and private company dealership acquisition activity.  Key findings of the report covering the first six months of 2016 included:

• 32 multi-dealership transactions completed
• 22% increase in average transaction size: average dealership group sold represented more than three franchises[1]
• 16% decline in overall transaction activity
• Dealership group sellers spurred by retirement, estate planning, lack of a succession plan and rising real estate prices
• Domestic buy/sell market share increases: buyers attracted to higher ROI vs. imports
• Private buyers continue to drive the market as publicly-traded dealerships’ market caps decline
• Publicly-traded dealerships, as a group, sold nearly as many dealerships as they acquired

“Many owners of multi-franchise groups, particularly those at or near retirement, are capitalizing on their ability to sell their groups to a single buyer in today’s market,” said Erin Kerrigan, Managing Director of Kerrigan Advisors. “Even with the exit of most of the public buyers, private buyers and new entrants remain active and are often attracted to the scale provided by larger group acquisitions. And, while the activity level in the first half of 2016, was lower than the first half of 2015, if annualized it would exceed the number of transactions completed in 2014.”   

The report identifies three key trends for the second half of 2016:

• Transaction sizes will continue to rise
• Public valuation declines in first half of year, portends potential private valuation declines
• The quality of current and future sales may weaken

“While buy/sell activity declined in the first half of 2016 for the first time since the recession, driven primarily by the exit of most public buyers, we expect the pace of acquisition activity to increase in the second half of 2016, as private buyers and new entrants continue seeking sizable acquisitions and sellers continue to capitalize on attractive valuations,” continued Kerrigan. “But it must be noted that the decline in the public dealership values as noted by The KAR Index, may portend a decline in future private values and the quality of industry sales may be weakening, increasing industry risk and resulting in lower dealership earnings.”

The Blue Sky Report™, a Kerrigan Quarterly, is published four times a year and includes Kerrigan Advisor’s signature blue sky charts, multiples and analysis for each franchise in the luxury and non-luxury segments. The multiples are based on Kerrigan Advisors’ view of franchise values in the current buy/sell market and can be applied to adjusted pre-tax dealership earnings to estimate blue sky value. To download the report, click here.

Kerrigan Advisors also releases a monthly index, The KAR Index, composed of the seven publicly traded auto retail companies with operations focused on the US market.  The KAR Index is designed to track dealership valuation trends, while also providing key insights into factors influencing auto retail. To access the KAR Index™, click here.

Erin Kerrigan is Managing Director of Kerrigan Advisors, and is a recognized industry expert on dealership valuation, real estate and buy/sells. A sought after commentator on automotive retailing topics ranging from consumer auto buying trends to auto retail consolidation to private equity in auto retail, she has keynoted numerous automotive conferences and her analysis has appeared in publications such as Automotive News and the Wall Street Journal.   

About Kerrigan Advisors

Kerrigan Advisors is a national dealership buy/sell advisory firm focused on providing a high level of client service for dealership sellers. Led by a team of veteran advisors who have represented transactions totaling over $2 billion dollars in automotive, private equity and investment banking, Kerrigan Advisors customizes each sale process to maximize the seller’s transaction proceeds. With the most comprehensive buyer database in the industry, Kerrigan Advisors has the industry context and expertise to match each seller with the right buyer.

Each quarter, Kerrigan Advisors publishes The Blue Sky Report™, a Kerrigan Quarterly, which is the auto industry's most comprehensive and authoritative quarterly report and analysis of dealership buy/sell activity and franchise values.  Kerrigan Advisors’ Managing Director Erin Kerrigan, who authors the report, is a recognized industry expert on dealership valuation, real estate and buy/sells, and is a frequent speaker at leading auto retail events and conferences, including NADA, JD Power Automotive Roundtable, AICPA, NADC and Driving Sales’ President’s Club. She has also been a keynote speaker for events hosted by American Honda Motor Company, Audi of America, US Trust, Ohio Automobile Dealer Association, and SunTrust Bank and has led webinars for NADA and Automotive News.  Her expertise is also featured in a monthly column for Dealer Magazine. 

Kerrigan Advisors Media Contact:

Cassandra Cavanah (cassandra@mwebbcom.com), mWEBB Communications, 818.397.4630
Melanie Webber (melanie@mwebbcom.com), mWEBB Communications, 424.603.4340

.

CarStory Launches VDP Deep Linking: Delivers Low Funnel Traffic and High Engagement to VDPs During “Moment of Search”

The CarStory Advertising Network offers faster and more effective Vehicle Details Page deep linking from CarStory’s extensive and highly trafficked network of automotive marketplaces

Austin, Texas – August 9, 2016 – Dealerships can now attract low-funnel, high-converting consumers from the highly trafficked CarStory Advertising Network via deep links directly into their websites’ Vehicle Details Pages (VDPs), CarStory announced today. The new offering also includes CarStory’s popular and comprehensive inline Market Reports, full of unique information that further engages consumers on their VDPs. Powered by over 30 used-car marketplaces, including Car and Driver, AOL Autoblog and J.D. Power, the CarStory Advertising Network boasts over 10 million unique search sessions monthly.

Deep linking to a dealer’s VDP is the most effective way of getting car shoppers to the exact vehicle they are viewing on a 3rd party marketplace – and offers the best opportunity for conversion because the shoppers are in prime time active research and decision making mode. VDP views have also been proven to be one of the best metrics for moving cars quickly and a recent study showed that VDPs with 20-30 page views spend 29% less time on the lot.

Compared to other VDP deep-linking programs, most of which rely on display advertising or SEM, the CarStory Advertising Network deep links from listings featured on automotive marketplace sites teeming with “in-market” consumers – and it is much faster:  car shoppers are transferred to dealership VDPs in just 200 milliseconds, approximately 25 times faster than other solutions. And, because the dealer’s VDPs are equipped with CarStory Market Reports, bounce rates are lower and engagement is measurably deeper: VDPs featuring CarStory’s free Market Reports have a 16% reduction in bounce rates and a 14% average increase in lead conversions.

“We have significantly advanced VDP deep linking by anchoring it to the ‘moment of search’ and sending car shoppers from our high traffic network to VDPs featuring CarStory Market Reports,” said Chad Bockius, Chief Marketing Officer of CarStory. “CarStory delivers a complete VDP solution: dealers cut out costly third parties along the shopping journey and get speedier access to deep funnel, in-market shoppers; while shoppers arrive on information-rich VDPs, increasing the likelihood of conversion.”

“CarStory Market Reports help turn our website visitors into car buyers – in addition to the amazing increase in lead conversion, our overall VDP bounce rate has gone down by 16%, while time spent on the page has increased by 10%,” said Ryan Montville, Webmaster, of Checkered Flag Auto Group.

CarStory Market Reports, adopted by over 6,000 dealerships nationwide, analyze tens of millions of pieces of customer vehicle preference data to provide consumers with inline ‘instant access’ information, including unique pricing and vehicle data, such as the number of owners the vehicle has had, if it has low mileage relative to others on the market, whether or not it is likely to sell quickly, as well as the features and packages that people find most interesting and valuable. This robust information keeps consumers engaged and eliminates the need for additional research that could take the shopper away from the dealer’s website. CarStory delivers 15,000,000 Market Reports each month to consumers around the country and they have been adopted by 50% of the top 10 dealer groups.

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About CarStory

CarStory is a service that matches used car shoppers with the right car. Using patented technology and an industry-leading dataset, CarStory facilitates an efficient, effective discovery process resulting in a confident purchase decision. With a network of over 6,000 participating dealerships nationwide, CarStory’s available inventory and user-data is the largest, and most accurate in the industry. Discover your new used car and drive happily ever after at: www.carstory.com.

About Vast 

Vast is a big data-as-service platform that provides consumer experiences —powered by data and analytics — for big purchases in automotive and real estate. Founded in 2005, Vast is the premier provider of big data solutions for many of the Global 1000’s largest automotive and real estate businesses. Learn more at Vast.com.

Media Relations: 

Melanie Webber, mWEBB Communications, 949) 307-1723, melanie@mwebbcom.com 

Cassandra Cavanah, mWEBB Communications 818) 379-4630, cassandra@mwebbcom.com

The Blue Sky Report™ released by Kerrigan Advisors analyzes dealership buy/sell activity for Q1 2016; overall activity, including multi-dealership transactions, size of groups coming into market and luxury import transactions, continues to rise; publics’ blue sky multiples decline: valuations at parity or below many private acquisition opportunities

Irvine, CA, June 7, 2016 – U.S. dealership buy/sell activity continued to rise in the first quarters of 2016, including growth in multi-dealership transactions, the size of groups coming into market, and luxury import transactions, according to The Blue Sky Report™, a Kerrigan Quarterly, which today released analysis of the first quarter of 2016.  But, the report reveals, this activity was accompanied by a monumental shift in public market valuations of auto retail stocks, putting a chill on public company acquisition activity.  Year to date, The KAR Index™ (The Kerrigan Auto Retail Index) declined by 11.8% and is down 30% from its high in June 2015.

“For public companies to trade at parity with private dealership groups is highly unusual. In most industries, when public consolidators decline in value, private companies quickly follow suit,” said Erin Kerrigan, Managing Director of Kerrigan Advisor.  “This aberration may be explained by auto retail’s continued fragmentation and domination by private companies.  It should be noted that the publics represent just 8% of industry revenue and a minority of industry acquisitions. Nevertheless, these declines are something to be watched and could be a leading indicator for future blue sky values.”

The report from Kerrigan Advisors is the auto industry's most comprehensive and authoritative quarterly report and analysis of dealership buy/sell activity and franchise values. Laying out the high, average and low multiples for each franchise in the luxury and non-luxury segments for the quarter, the report offers a detailed view of public and private company dealership acquisition activity. 

According to the report, key activities influencing trends in the first part of the year were the completion of a few very large acquisitions, including AutoNation’s purchase of the Allen Samuels Group in Texas and Fremont Private Holdings purchase of Morrie’s Automotive in Minnesota.  Among the leading buy/sell trends, The Blue Sky Report identifies the following three as shaping the market for the balance of 2016:

• Private buyers and new entrants dominating 2016’s buy/sell market
• Acquisition financing terms drive purchase price
• Blue sky values increasingly based on multi-year average earnings

“While the 2016 buy/sell market is expected to be as active as 2015’s, we anticipate greater pricing disparity as industry growth plateaus and dealership earnings come under pressure,” continued Kerrigan. “There seems to be a growing divide between the bid/ask spread in the buy/sell market. Sellers have very high pricing expectations, particularly in the luxury market, and buyers are increasingly challenged to achieve their return on investment requirements.”

The Blue Sky Report™, a Kerrigan Quarterly, is published four times a year and includes Kerrigan Advisor’s signature blue sky charts, multiples and analysis for each franchise in the luxury and non-luxury segments. The multiples are based on Kerrigan Advisors’ view of franchise values in the current buy/sell market and can be applied to adjusted pre-tax dealership earnings to estimate blue sky value. To download the report, click here.

Kerrigan Advisors also releases a monthly index, The KAR Index, designed to help public and private auto retailers understand the true value of their dealerships, while also providing key insights into factors influencing valuations of these public companies, with broader implications for the auto industry as a whole. To access the KAR Index™, click here.

Erin Kerrigan is Managing Director of Kerrigan Advisors, and is a recognized industry expert on dealership valuation, real estate and buy/sells. A sought after commentator on automotive retailing topics ranging from consumer auto buying trends to auto retail consolidation to private equity in auto retail, she has keynoted numerous automotive conferences and her analysis has appeared in publications such as Automotive News and the Wall Street Journal.   

About Kerrigan Advisors

Kerrigan Advisors is a national dealership buy/sell advisory firm focused on providing a high level of client service for dealership sellers. Led by a team of veteran advisors who have represented transactions totaling over $2 billion dollars in automotive, private equity and investment banking, Kerrigan Advisors customizes each sale process to maximize the seller’s transaction proceeds. With the most comprehensive buyer database in the industry, Kerrigan Advisors has the industry context and expertise to match each seller with the right buyer.

Each quarter, Kerrigan Advisors publishes The Blue Sky Report™, a Kerrigan Quarterly, which is the auto industry's most comprehensive and authoritative quarterly report and analysis of dealership buy/sell activity and franchise values.  Kerrigan Advisors’ Managing Director Erin Kerrigan, who authors the report, is a recognized industry expert on dealership valuation, real estate and buy/sells, and is a frequent speaker at leading auto retail events and conferences, including NADA, JD Power Automotive Roundtable, AICPA, NADC and Driving Sales’ President’s Club. She has also been a keynote speaker for events hosted by American Honda Motor Company, Audi of America, US Trust, Ohio Automobile Dealer Association, and SunTrust Bank and has led webinars for NADA and Automotive News.  Her expertise is also featured in a monthly column for Dealer Magazine. 

Kerrigan Advisors Media Contact:
Melanie Webber (melanie@mwebbcom.com), mWEBB Communications, 424.603.4340

Index from Kerrigan Advisors shows high inventory levels, gross margin compression, and weak sales forecasts depressing public auto retailer valuations

Irvine, CA, May 18, 2016 – Kerrigan Advisors today announced that The KAR Index™ (The Kerrigan Auto Retail Index) has dropped 9% - from 496.82 to 452.49 – in just the last two weeks, indicating depressed public auto retailer valuations. The KAR Index™ attributes the sharp drop to higher inventory levels, gross margin compression in new vehicle sales, and weakening retailer sales forecasts.

“This is a continuation of a volatile first quarter” said Erin Kerrigan, Managing Director of Kerrigan Advisors.  “After far outperforming the S&P 500 between 2009 and 2015 by over 700%, gravity is starting to set in. With sales growth slowing, auto retail will be a much more competitive industry going forward, likely resulting in lower earnings growth.”

The latest KAR Index™, which is a monthly index for the auto retail industry covering the seven publicly traded auto retail companies with operations focused on the US market, shows:

• Weakening sales projections and inventory surpluses are having an impact on the publics’ forecasts, contributing to declines in their share prices.
• Five of the seven publics – Asbury Automotive Group, Group 1 Automotive, Lithia Motors, Auto Nation, and CarMax - reporting drops in net income in the first quarter of 2016
• Margins for new car sales are under pressure from high inventory levels, more internet sales channels, and increased consumer awareness.

“Although the publics’ share prices are depressed, there is a silver lining: auto retailers have been taking advantage of the dip by repurchasing stock, allowing them to decrease the number of shares outstanding and increase their EPS,” said Ryan Kerrigan, Managing Director of Kerrigan Advisors.

The KAR Index is designed to help public and private auto retailers understand the true value of their dealerships, while also providing key insights into factors influencing valuations of these public companies, with broader implications for the auto industry as a whole. To access the KAR Index™, click here.

Kerrigan Advisors also releases The Blue Sky Report™ four times a year and includes Kerrigan Advisor’s signature blue sky charts, multiples and analysis for each franchise in the luxury and non-luxury segments. The multiples are based on Kerrigan Advisors’ view of franchise values in the current buy/sell market and can be applied to adjusted pre-tax dealership earnings to estimate blue sky value. To download The Blue Sky Report, click here.

Erin Kerrigan is Managing Director of Kerrigan Advisors, and is a recognized industry expert on dealership valuation, real estate and buy/sells. A sought after commentator on automotive retailing topics ranging from consumer auto buying trends to auto retail consolidation to private equity in auto retail, she has keynoted numerous automotive conferences and her analysis has appeared in publications such as Automotive News and the Wall Street Journal.   For a recent video of Erin’s commentary on the market, click here.

About Kerrigan Advisors

Kerrigan Advisors is a national dealership buy/sell advisory firm focused on providing a high level of client service for dealership sellers. Led by a team of veteran advisors who have represented transactions totaling over $2 billion dollars in automotive, private equity and investment banking, Kerrigan Advisors customizes each sale process to maximize the seller’s transaction proceeds. With the most comprehensive buyer database in the industry, Kerrigan Advisors has the industry context and expertise to match each seller with the right buyer.

Each quarter, Kerrigan Advisors publishes The Blue Sky Report™, a Kerrigan Quarterly, which is the auto industry's most comprehensive and authoritative quarterly report and analysis of dealership buy/sell activity and franchise values.  Kerrigan Advisors’ Managing Director Erin Kerrigan, who authors the report, is a recognized industry expert on dealership valuation, real estate and buy/sells, and is a frequent speaker at leading auto retail events and conferences, including NADA, JD Power Automotive Roundtable, AICPA, NADC and Driving Sales’ President’s Club. She has also been a keynote speaker for events hosted by American Honda Motor Company, Audi of America, US Trust, Ohio Automobile Dealer Association, and SunTrust Bank and has led webinars for NADA and Automotive News.  Her expertise is also featured in a monthly column for Dealer Magazine. 

Kerrigan Advisors Media Contact:
Melanie Webber (melanie@mwebbcom.com), mWEBB Communications, 424.603.4340

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Gubagoo ChatSmart received a “Top Rated” Award for Dealer Satisfaction in the Chat Products Category

West Palm Beach, FL – April 26, 2016 – Gubagoo ChatSmart is the recipient of a “Top Rated” Chat Products award in the seventh annual DrivingSales Dealer Satisfaction Awards.

“We are honored to receive a DrivingSales Dealer Satisfaction Award for ChatSmart,” said Brad Title, CEO of Gubagoo, Inc. “Especially because this award is based on comparisons and ratings from dealerships on the industry’s only neutral feedback platform. We are proud to see that what we work so hard on is making a positive, demonstrable difference to dealerships across the country…it’s why we do what we do.”

Gubagoo has one of the most advanced chat platforms ever made available to the auto industry. Chatsmart, Gubagoo’s 24/7 Behavioral Live Chat, is powered by the B.E.A.S.T behavioral intelligence system and designed to provide a dynamic and customized experience for dealership website shoppers. What’s more, Gubagoo’s recent launch of ResQ adds to the power of its chat product by making it possible for sales staff to monitor all live conversations and determine how best to proceed: ignore it, “whisper” to operators, or “ResQ” the conversation and jump right in, releasing the operator.

“We congratulate Gubagoo on being a ‘Top Rated’ Chat Product Award recipient and for being recognized by its dealer customers for high levels of excellence and customer satisfaction,” said DrivingSales CEO and Founder Jared Hamilton. “For seven years, and through over 25,000 validated reviews, DrivingSales Vendor Ratings has helped dealers make smart, more informed decisions, leading them to outstanding service providers such as Gubagoo, with Chatsmart.”

The DrivingSales Dealer Satisfaction Awards are based on cumulative ratings tallied and verified over the calendar year (January–December) at DrivingSales.com Vendor Ratings.  DrivingSales Vendor Ratings is the industry’s only neutral, comprehensive vendor rating forum featuring real-time peer reviews and honest competitor comparisons, and provides dealerships with important information from actual customers who have hands-on experience using vendor products / solutions in their stores. Each rating is verified as coming from an actual dealership employee.

Full award results are available online at http://dealersatisfactionawards.com/. Award winners are showcased in the Q1 2016 issue of the DrivingSales DealerExec delivered to more than 2,000 of the top used car dealer in the U.S. For more information on DealerExec, please visit: dealerexecmag.com
 

About Gubagoo

Based in West Palm Beach, Florida, and staffed by a team of veteran technologists and innovators in lead conversion, Gubagoo offers revolutionary behavioral engagement and scoring technologies for automotive websites. With a mission to provide a smarter, more cost-effective alternative to the old lead generation model, Gubagoo is the first dealership website solution that successfully makes anonymous traffic identifiable, and converts the 95% of dealer site traffic that traditionally defects. Incorporating smart predictive matching and the best chat technology available - and powered by its proprietary behavioral engagement and scoring engine, ‘B.E.A.S.T.’ - Gubagoo engages new and repeat dealer site visitors with unprecedented relevance. Over 1,900 dealerships, including some of the nation’s largest dealer groups, as well as OEM-certified programs, already have adopted Gubagoo-powered websites.

Gubagoo Media Relations:

Melanie Webber, mWEBB Communications, (949) 307-1723, melanie@mwebbcom.com 

Elizabeth Johnson, mWEBB Communications, (213) 713-4865, elizabeth@mwebbcom.com

About DrivingSales 
DrivingSales is a professional network serving the auto industry with dealer-driven news and information, online training, and performance data, all to enable dealers to make critical business decisions at their dealerships. DrivingSales’ mission is to connect progressive dealership professionals to the people and information they need to maximize their success. Founded by a third-generation car dealer, and opened up to the industry in 2008, today DrivingSales has registered users in over 50% of new car dealerships in the US and is active in several other countries around the globe. To learn more about the DrivingSales community, training or performance analytics visit DrivingSales.com, DrivingSalesUniversity.com and DrivingSalesData.com

DrivingSales Media Relations: 
Christina DeVore
christina.devore@drivingsales.com
Events Marketing Director
866.943.8371 x124