IRVINE, Calif. — Kerrigan Advisors reports a total of 58 U.S. auto dealership transactions were completed in the third quarter, down 10% from the year-ago period but an 18.4% increase from the prior quarter. The buy/sell firm’s latest Blue Sky Report predicts dealers will add to a five-year streak of 200-plus acquisitions.
“Based on the first three quarters, 2019 is pacing to be another 200-plus transaction year, likely matching 2018’s high activity level. Kerrigan Advisors expects the third quarter’s deal momentum to increase in the fourth quarter as buyers and sellers are more motivated to close before year end,” the report states, in part.
Analysts pointed to a healthy economy as one of the key factors driving the dealership buy/sell market, citing a 2.9% gain in annualized consumer spending. Growth in consumer spending has helped offset “weakness” in the commercial sector, “weighed down by trade disputes and a slowing global economy.”
The report also pointed to a series of cuts to the Federal Reserve’s target interest rate as a key factor driving shopper behavior and dealers’ long-term outlooks.
“Supportive credit markets are the backbone of a healthy auto retail market, both for the consumer (auto loans) and the dealer (floorplan),” analysts wrote. “Not surprisingly, with an improved interest rate outlook, the average dealer reported strong earnings growth through the third quarter of 2019, continuing last quarter’s trend.”
Kerrigan Advisors is honored to work with auto retailers throughout the US to enhance the value of their enterprise. Learn more about our services below:
Customized and confidential sell-side services for higher value dealerships and dealership groups nationwide, with a proven record of achieving the highest sale price per transaction of any firm in the industry.
Capital raising and partnership structuring for growing dealership groups, supported by the largest investor database in the industry.
If you are a buyer in today’s market, Kerrigan Advisors welcomes the opportunity to learn about your acquisition criteria and include you in Kerrigan Advisors’ proprietary Buyer Database.
We welcome the chance to learn more about your acquisition criteria so that we can contact you in the event a client matches your investment profile.
Contact us to learn more about Kerrigan Advisors’ client services, or to have a conversation about the buy/sell market. All of our conversations are 100% confidential.