Kevin Wilde November 14, 2017

Auto Dealership Groups

Thesis Auto dealership groups with scale are attractive businesses with good profitability and attractive growth opportunities driven by industry consolidation. Dealership franchises are protected from competition by regional exclusivity. They earn high margins on vehicle parts & servicing by acting as the warranty arms and parts distributors for their major automaker partners. Despite similar economics and growth opportunities, U.K. auto dealerships look cheap relative to their global counterparts. Vertu Motors plc (LSE:VTU) looks particularly cheap despite less debt / risk, better past growth, improving margins...

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