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Capital Available for Financing Basic Transportation

Smicklas makes some strong points ("Smart Management Makes the Business Model Work"). The stock has fallen dramatically, though, as the market has plunged. I recently wrote about the company on my blog (http://ab.typepad.com/ab_analytical_services/2008/11/americas-car-mart-great-vehicle-for-tough-times.html) and the stock has fallen even further.

I interviewed the Chairman, Skip Falgout, after posting my views and was even more interested in the story. The company is seeing customers come into its dealerships that previously hadn't stepped foot inside. He stated that while they didn't exactly come in admitting it, clearly the access to financing is a big issue. The company, which stumbled a few years ago when it expanded too rapidly, is all about nuts and bolts: Execution. The get cars, they sell them, they finance them and they collect on them. It sounds to me like they getting cars part is easier - they just have to go next door to the dealer who can't sell cars because their lenders will no longer finance them.

The stock trades at/below book value, a very low PE and well below its potential growth. CRMT is one of just a handful of companies outside of healthcare and consumer staples that I expect can actually grow in 2009.

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