Trucking Industry Explosions and Implosions

The trucking industry has recently been shaken by a series of large accident-related litigation verdicts, also known as nuclear verdicts.  The definition of what constitutes a nuclear verdict can vary; however, the most common definition is verdicts in excess of $10 million.  No matter how they are defined, nuclear verdicts are causing upheaval in the trucking industry. 

Always Cash Flow and Earning Power

We recognize what matters today for many funds is helping portfolio companies survive a sharp drop in revenues rather than discerning how much first quarter marks may fall from the last valuation.

December 2019 SAAR

SAAR1 came in at 16.70 million for December 2019, as a shortened holiday season led to volume declines of 5.8%. However, total volume was 17,047,725 for 2019, the fifth straight year above 17 million. While volumes did decline, the drop … Continued

January 2020 SAAR

SAAR came in at 16.844 million for January 2020, up about 1% from both the prior month and the prior year. Actual sales of 1.13 million units was slightly down from January 2019. Similarly, while SAAR was up from last … Continued

Do Win/Loss Records Affect Major League Baseball Revenues and Attendance?

Many people believe that the win/loss ratio doesn’t have much effect on revenues and attendance.  They believe the local team has loyal fans who will attend games despite their performance.   We investigate that assumption in this article focusing on Major League Baseball (MLB) by sampling a top tier, middle tier, and lowest tier team.

In Game Leaders Esports Summit Insights

The In Game Leaders (IGL) Winter Summit took place January 3, 2020 at the esports Stadium Arlington. IGL originated as a capstone project for summer interns at esports Stadium Arlington. The primary purpose of the Summit was to “[provide] the opportunity to learn from industry professionals and collegiate leaders as they speak about the various career paths in esports. IGL strives to teach parents and students how to develop a sustainable career in the rapidly-growing esports field.” This second event consisted of several panels that addressed collegiate esports, professional esports, as well as marketing and event management. We recap a few key panels below.

Valuation Issues in Auto Dealer Litigation

In our family law and commercial litigation practice, we often serve as expert witnesses in auto dealership valuation disputes. We hope you never find yourself a party to a legal dispute; however, we offer the following words of wisdom based upon our experience working in these valuation-related disputes. The following topics, posed as questions, have been points of contention or common issues that have arisen in recent disputes. We present them here so that if you are ever party to a dispute, you will be a more informed user of valuation and expert witness services.   

Five Trends to Watch in the Medical Device Industry

The medical device manufacturing industry produces equipment designed to diagnose and treat patients within global healthcare systems.  Medical devices range from simple tongue depressors and bandages, to complex programmable pacemakers and sophisticated imaging systems.  Major product categories include surgical implants and instruments, medical supplies, electro-medical equipment, in-vitro diagnostic equipment and reagents, irradiation apparatuses, and dental goods. This article outlines five structural factors and trends that influence demand and supply of medical devices and related procedures.

Key Valuation Considerations for FinTech Purchase Price Allocations

FinTech M&A continues to be top of mind for the sector as larger players seek to grow and expand while founders and early investors look to monetize their investments. In this article, we discuss one of the most significant assets to be considered in FinTech acquisitions, customer relationships, and how to value these assets.

The Rise of FreightTech

Over the past few years, FreightTech has emerged as its own category of technology. The level of excitement in the space grew in 2018 as global venture capital investment increased to $2.9 billion from $1.3 billion the prior year. FreightTech is on track for another year of exponential growth in 2019.

NADC 2019 Spring Conference Recap

Scott Womack recently attended the 2019 Spring Conference of the National Auto Dealers Counsel (NADC) in Dana Point, California. This article provides a couple of key takeaways from the day and a half sessions on the current conditions in the industry.

Labor Shortage in Trucking Sector

The trucking industry is wedged between a rock and a hard place when it comes to driver recruitment. Trucking companies are simultaneously exploring self-driving technology, while still convincing new entrants to the labor market that commercial driving is a career choice that will pay off. The driver shortage has also sparked major shifts in the way hiring and training are conducted in the industry. While this shortage will hurt shippers until autonomous technology is fully developed, the long-term problem may actually lie in another labor pool: service technicians.

How to Value an InsurTech Company

InsurTech, a FinTech niche, continues to threaten the traditional state of the insurance industry. In this article, we provide an overview of the niche and the market conditions in which these companies operate, as well as company-specific considertions to understand when valuing these companies.

Adjusted Earnings and Earning Power as the Base of the Valuation Pyramid

The extensive use of core versus reported earnings by public companies has been a widespread phenomenon for at least 25 years. During the past decade, the practice also has become widespread among companies (and their bankers who market deals) that are issuing debt in the leverage loan and high yield markets.

If investors are solely relying upon company defined adjusted EBITDA, then they may be vacating their fiduciary duties when investing capital. That said, an analysis of core versus reported earnings is a critical element of any valuation or credit assessment of a non-early stage company with an established financial history.

Value Drivers of a Store Valuation

Auto dealers, like most business owners, are constantly wondering about the value of their business. It’s easy to see how this issue moves to the forefront around certain events such as a transaction, buy-sell agreement, litigation, divorce, wealth-transfer event, etc. There are many other instances when a dealer can evaluate the condition, progress, or value of their store. Dealers can actually influence the value of their store prior to these obvious events by understanding the value drivers of a store valuation and addressing them on a consistent basis. So what are some of the value drivers of a store valuation?

Six Different Ways to Look at a Dealership

Along the road to building the value of a dealership, it is necessary and appropriate to examine the dealership in a variety of ways. Each provides unique perspective and insight into how a dealer is proceeding along the path to grow the value of the dealership and if/when it may be ready to sell. Most dealers realize the obvious events that may require a formal valuation: potential sale/acquisition, shareholder dispute, death of a shareholder, gift/estate tax transfer of ownership, etc. A formal business valuation can also be very useful to a dealer when examining internal operations.

Valuing an eSports Team

The value of a company is generally dependent on three factors: risk, growth, and cash flow. Esports teams have an abundance of risk as well as growth potential. Considering eSports is a relatively new industry, the growth potential is huge. At the same time, and for the same reason, there is significant risk in the industry – it is too early to know if there is a proven, sustainable, cash flow generating business model.

Pro Sports Player Contract Valuations And The New Tax Law

The change in the tax law brings additional attention to player contract values as they are now potentially taxable events for teams. It may or may not impact how a team approaches its business of winning championships, but it will impact how leagues and front offices approach valuations of player contracts.

Automobile Dealership Valuation 101

Valuation of a business can be a complex process requiring certified business valuation and/or forensic accounting professionals.  Valuations of automobile dealerships are unique even from valuation of manufacturing, service, and retail companies.  Automobile dealership valuations involve the understanding of industry terminology, factory financial statements, and hybrid valuation approaches.  For these reasons, it’s important to hire a business valuation expert that specializes in automobile dealership valuation and not just a generalist business valuation appraiser. 

eSports: Business Models

An eSports team can make money in a variety of ways, including broadcast revenue, sponsorships, merchandise sales, and subscriptions. In this industry overview, we discuss various business models for eSports teams.

eSports: An Emerging Industry

eSports is a rapidly expanding industry that has drawn viewers and investments alike. The introduction of streaming platforms, as well as the improvement in mobile technology, has allowed the industry to grow from its arcade hall beginnings in the 1970s to competitors streaming games to millions of viewers globally. In this whitepaper, we provide a brief overview of the sport and expand on the potential growth of this emerging industry.

Orthopedics Overview

The worldwide market for orthopedic products in 2016 was estimated to be nearly $48.2 billion, an increase of 3.2% from 2015. Demographics will continue to be a key driver of industry expansion, with population growth and rapidly-growing international markets driving the need for musculoskeletal care. Increasing life spans, the increasing prevalence to remain active, and increasing obesity rates will impact the number of individuals with joints subject to degeneration, thereby increasing demand for orthopedic/joint replacement procedures.