Adviser Alan Haig said, "They are aware we're nearing the end of this upward swing in new-vehicle sales, which drive profits."
Blue sky multiples peaked last year and, on average, declined by 1 percent at the end of the fourth quarter, said Haig, president of Haig Partners in Fort Lauderdale, Fla. It's the first decline he has seen since 2009.
The multiples are still healthier than in prior years, but are under pressure from the economic cycle and because more dealerships are coming up for sale, said Haig, author of the Haig Report.
Overall blue sky multiples "are still very strong today compared with historical levels," he said, but "we believe there's a chance they will begin to decline as we get closer to new-vehicle sales leveling off or falling."
In addition, "Buyers have more opportunity now to buy more stores and they don't have to stretch as far as they had to in 2014 and 2015 to make a deal," Haig said.
Kerrigan, author of the Blue Sky Report, said blue sky multiples are "at peak levels and not likely to rise significantly" because "we are at peak earnings for the industry and we're likely at an earnings plateau."
In her latest report, Kerrigan raised the blue sky multiple for only one brand: Subaru, putting it at 4.5 to 6 times earnings, up from 4 to 5.5.
"It led the nonluxury segment in sales and market share growth and it increased average sales by franchise by over 200 units in the last two years," Kerrigan said. "It was the top import brand in Seattle and Portland, so they're overtaking Honda and Toyota in certain big markets."
She added coverage of Buick-GMC, based on clients' requests, setting its multiple at 3 to 4.
Haig raised Buick-GMC's multiple to 3.25 to 4.25, from 3 to 4, citing lower gasoline prices spurring demand for trucks.
But he reduced Audi's and BMW's multiples to 7 to 9, from 7.5 to 10. Haig said the decline in new-vehicle profit margins along with what dealers perceive as "onerous facility requirements" have slightly reduced demand for these dealerships.
He slashed Volkswagen's blue sky value -- which he has estimated on a flat basis, rather than a multiple, since the diesel-emissions scandal erupted in September -- to $0 to $2 million, from a previous range of $250,000 to $2.5 million.