America’s Car-Mart, Inc. Completes $161.3 Million Term Securitization

Core Viewpoint - America's Car-Mart, Inc. has completed a term securitization transaction, issuing $161.3 million in asset-backed notes with a weighted average coupon of 7.02%, which is expected to enhance capital efficiency and cash flow for the company [1][2]. Group 1: Transaction Details - The 2025-4 transaction introduces a more efficient deal structure that is projected to generate increased cash flow compared to previous securitizations [2]. - The new residual cash flow structure will provide funds to the company on a monthly basis, reducing the long-term cost of capital by minimizing the need for frequent transactions and associated fees [2][3]. Group 2: Management Insights - The CEO emphasized the importance of multi-year strategies to improve the capital structure and operating platform for long-term success, highlighting progress in improving spreads and weighted average coupons since entering the ABS market in 2022 [3]. - The CFO noted that the transition to a residual cash flow structure is a significant advancement in the securitization program, with the 7.02% coupon reflecting a shift from an accelerated amortization structure, which retains more value for the company over the deal's life [3]. Group 3: Company Overview - America's Car-Mart operates automotive dealerships in 12 states and is one of the largest publicly held automotive retailers in the U.S., focusing on the "Integrated Auto Sales and Finance" segment of the used car market [5]. - The company emphasizes superior customer service and strong personal relationships with customers, primarily operating in smaller cities throughout the South-Central United States [5].