Any time a retailer can fold financing, insurance and other aftermarket products into a deal, the profit picture is going to improve. There is an outfit in Lake Success, New York that specializes in assisting auto dealers with those very issues.

DealerTrack Holdings (NASDAQ: TRAK) provides software and data solutions for the U.S. automotive retail industry. The company's online credit application processing product automates and accelerates the automotive financing process, while its integrated subscription-based software enables dealers to receive consumer leads, compare financing and leasing options, sell insurance and associated products, document compliance, and execute financing contracts electronically. Over 22,000 dealers and more than 300 financing sources are active in the DealerTrack network.

The company pleased investors late last month, when it reported Q4 EPS of 23 cents and revenues of $45.7 million. Analysts had been expecting 19 cents and $43.2 million. Management also guided FY07 EPS to $1.01-$1.03 ($1.01 consensus) and FY07 revenues to $219-$221 million ($206.84M consensus). Deutsche Securities subsequently reiterated its "buy" rating on the stock and boosted its price target to $38. TRAK shares popped on the news and have since been consolidating the gain in a bullish "flag" pattern. Stocks frequently exit flags moving in the same direction they were traveling when they entered them. In this case, that would be to the upside.

Brokers recommend the shares with four "strong buys," three "buys" and two "holds." Analysts see a 25% average annual growth rate through the next five years. The TRAK Price to Book ratio (3.88), Sales Growth rate (36.83%) and EPS Growth rate (228.57%) compare favorably with industry, sector and S&P 500 averages.

Institutions hold about 74% of the outstanding shares. Over the past 52 weeks, the stock has traded between $18.51 and $33.25. A stop-loss of $26.75 looks good here.

Larry Schutts is a contributing editor for Theflyonthewall.com and the Vice-President of Stockwinners.com.