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To: Alex who wrote (4677)	12/23/1997 12:21:00 PM
From: Alex	Read Replies (1) \| Respond to of 116753

A good futures\options site.................. quotewatch.com

To: Alex who wrote (4677)	12/23/1997 12:42:00 PM
From: Bucky Katt	Read Replies (1) \| Respond to of 116753

Looks like a warning shot on US consumer debt>>> United Auto Group is one of a string of auto dealerships that has gone public in the last year, with several others still waiting in the wings. The company billed itself in its October 1996 initial public offering (IPO) as the second-largest new and used car dealer after former stock market darling Republic Industries (NYSE:RII - news) , essentially selling itself as the second-coming of Republic. Trading up to $34 on the day of the offering, the shares now sit more than 50% lower than that price. Management blamed the debacle on three factors -- manufacturer delays in processing finance applications, delays in closing acquisitions, and losses from the captive auto finance unit. Although the delays probably didn't help, there was enough going wrong that it would hardly start the list of any objective viewer's breakdown of the quarter. First and foremost, United Auto's purchase of Young Automotive and another dealership has been delayed, while the interest costs from the $200 million of 11% notes the company sold this quarter to finance these deals are sucking cash. The Young deal is particularly troublesome, as Young agreed to take $25 million in falling stock as part of the deal. Odds are future acquisitions will not be as likely to take even a paltry third of the price in United Auto Group shares. Secondly, the company's financing operation generated much higher-than-expected losses on allegedly first-class credit risks. Given that many of these auto dealerships actually make most of their money on the financing, any signs of weakness here present a big problem. The fact that the auto dealerships (and auto companies) have long been camouflaging financing operations, investors just waking up to the fact that there is a big risk here were asleep at the wheel when they bought the shares. Non-bank finance companies, particularly non-bank finance companies tied to large ticket items, require an extra level of analysis.