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Report: Slow Sales Aside, Auto Groups Outperform Market

Kerrigan Advisors analysts say the stock prices for America’s seven publicly traded dealership groups are outpacing the broader U.S. equity markets and could soar higher on lower interest rates and new trucks.

Tariq Kamal
Tariq KamalFormer Associate Publisher
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July 10, 2019
Report: Slow Sales Aside, Auto Groups Outperform Market

CarMax registered its highest all-time stock price in June, leading the nation’s publicly traded dealer groups to a collective year-over-year improvement of 10.4%.

Photo by Ildar Sagdejev via Wikimedia Commons

2 min to read


IRVINE, Calif. — The Kerrigan Index registered at 564.25 in June, a 10.4% year-over-year increase and 31.2% year-to-date improvement. Buy/sell firm Kerrigan Advisors publishes the index, which tracks the stock prices for the publicly traded AutoNation, Asbury, CarMax, Group 1, Lithia, Penske, and Sonic dealership groups.

The improvement was driven largely by CarMax, which posted its all-time highest stock price, as well as 52-week highs for Asbury and Group 1. Despite a nationwide decline in new light-vehicle sales, the Kerrigan Index far outperformed the S&P 500 Index, which improved by 6.9% in June and 17.3% year-to-date.

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“Some analysts are predicting a stronger second half given the launch of new and redesigned light trucks, as well as a possible interest rate cut from the Federal Reserve,” the report states, in part. “Strong consumer confidence, steady economic growth and employment gains, and relatively low gasoline prices continue to support new light-vehicle demand, though analysts have noted that affordability is increasingly weighing on the market.”

The firm’s founder and managing director, Erin Kerrigan, noted that, unlike other industries, auto retail benefits from the push and pull of new- vs. used-vehicle sales.

“We’re seeing that these companies continue to perform, their earnings are strong, and a lot of that is driven by the diversified business model that auto retail is so fortunate, frankly, to have,” Kerrigan told CBT News. We have not only new-car sales that we rely on, but also used-car sales, and used-car sales have been tremendously strong.”

To access the full report, click here.

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