Vertu Motors (LON:VTU) claims to be the eighth largest motor retailer in the UK.
The words 'retail', 'motor' and 'investment opportunity' do not always sit easily in the same sentence, so let's see if VTU has enough oomph to get into top gear or whether I've got a lemon on my hands.
Why Am I Interested?
1. The shares are trading at a 37% discount to reported net assets
2. Directors have been buying in the last 12 months
3. Declared a maiden dividend in its interim results in October 2010
4. I have a holding at a break-even cost of 31p per share (acquired before my blog started)
Background
History & Operations
???????VTU was formed in 2006 as a new vehicle to consolidate UK motor retailers, raising £25m and listing on AIM in December 2006. Since then, the Company has made numerous acquisitions and raised £56m through two Placings and has £45m in debt facilities (£12m drawn). 
In essence, the strategy involves buying dealerships at reasonable prices and getting more out of them through applying "consistent business processes and systems" - ie increasing profits through harmonising and standardising as part of a larger corporate organisation - the whole is worth more than the sum of the parts kind of thing.
The Company is now present in over 70 locations, via 84 franchised and 3 non-franchised sales operations.
Activities include: new and used car sales, fleet contracts, commercial vehicles and 'after-sales' (servicing, repairs and parts). After-sales has by far the highest gross profit margins (41%) compared to new car sales (8%) and used car sales (10-12%).
The main brands sold include: Ford, Honda, Vauxhall, SEAT and Peugeot.
Investor Relations can be found here
?
Share Price & Value ???????????The current share price of 28.5p (mid-point as at 23 February) gives the Company a market value of £57m. Based upon the 2010 basic EPS of 2.2p, this represents a PER of 12.8x. The Company is listed on AIM.
In the past five years, the shares have hit a high of 101.5p (Dec 2008) and a low of 10p (Feb 2007).
