SecProbe.io

<DOCUMENT>
<TYPE>CORRESP
<SEQUENCE>1
<FILENAME>filename1.txt
<TEXT>
<PAGE>

[LATHAM & WATKINS LLP LETTERHEAD]

November 14, 2005

VIA EDGAR AND HAND DELIVERY
---------------------------

Mr. Brad Skinner
Accounting Branch Chief
U.S. Securities and Exchange Commission
Division of Corporation Finance
100 F Street, N.E.
Mail Stop 4561
Washington, D.C.  20549

     Re:   DealerTrack Holdings, Inc.
           Registration Statement on Form S-1 File No. 333-126944

Dear Mr. Skinner:

        On behalf of DealerTrack Holdings, Inc. (the "Registrant"), we are
responding to the comments of the Staff of the U.S. Securities and Exchange
Commission (the "Commission") set forth in your letter dated October 26, 2005
with respect to the Registrant's above-referenced Registration Statement on
Form S-1 (the "Registration Statement") filed with the Commission on July 28,
2005, as amended by Amendment No. 1 to the Registration Statement ("Amendment
No. 1") filed on September 22, 2005, Amendment No. 2 to the Registration
Statement ("Amendment No. 2") filed on October 12, 2005 and Amendment No. 3 to
the Registration Statement ("Amendment No. 3") filed on October 24, 2005.
Earlier today, the Registrant filed via EDGAR Amendment No. 4 to the
Registration Statement ("Amendment No. 4"), which was revised to reflect
changes prompted by your comments and to include certain other information.
Amendment No. 4 contains the various revisions described below.  For your
convenience, we have enclosed a courtesy package which includes five copies of
Amendment No. 4, two of which have been marked to show changes from Amendment
No. 3.

        The Staff's comments of October 26, 2005 are set forth below in bold,
followed by the Registrant's responses to each comment.

Amendment No. 3 to Form S-1, filed on October 24, 2005
------------------------------------------------------

Notes to Unaudited Combined Condensed Pro Forma Statements of Operations, page
------------------------------------------------------------------------------
38
--

1.      We note that you have revised your weighted average shares outstanding
        calculations in response to our prior comment number 1 to include all
        of the common shares to be issued under this offering.  Please revise
        further to exclude any common shares whose proceeds will be used for
        general corporate purposes.  Note that you may present additional EPS
        data reflecting the issuance of all shares if you consider the
        information to be meaningful and if you label and describe the
        presentation appropriately.

<PAGE>

November 14, 2005
Page 2
Latham & Watkins LLP

Response:  The Registrant has revised its disclosure in the Unaudited Combined
Condensed Pro Forma Statements of Operations to exclude from the as adjusted
weighted average shares outstanding (basic and diluted) any common shares whose
proceeds will be used for general corporate purposes.  Please refer to pages
38, 39 and 45 of Amendment No. 4.

Management's Discussion and Analysis of Financial Condition and Results of
--------------------------------------------------------------------------
Operations
----------

Stock-Based Compensation, page 53
---------------------------------

2.      In your response letter dated September 22, 2005, you indicated to us
        that your underwriters informed you in July 2005 that the estimated
        price range for your initial public offering would likely be between
        $17.00 and $19.00 based on "anticipated 2006 earnings and continuing
        improvement in operating results during the remainder of 2005."
        Separately, you have indicated to us that your board of directors
        preformed an assessment and concluded that the mid-point of this range
        represented the fair value of your common shares in July.  Please
        explain to us how your underwriters determined this estimated price
        range and describe the process that your board of directors followed in
        concluding that the mid-point of that range represented the fair value
        in July.

Response:  Our underwriters determined the estimated price range using the
Registrant's then current 2006 earnings projections and applied a multiple of
earnings based upon public company comparables.  Our Board of Directors (the
"Board") concluded that the $18.00 mid-point of the range represented the most
reasonable estimate of the fair value of our common stock in July 2005.  In
connection with the preparation of our consolidated financial statements for
the nine months ended September 30, 2005, the Board reassessed the fair market
value of the common shares underlying the equity awards granted to employees
and directors during May and June 2005. The Board determined that the value
provided by our underwriters as of July 2005 was the most appropriate value to
use for the May and June 2005 grants.  Consistent with the prior May and June
2005 methodology, the Registrant has applied a 5% illiquidity discount to the
$18.00 mid-point to arrive at a fair value of $17.10 for the purpose of valuing
the stock options and restricted stock awards issued in May and June 2005.  The
Registrant has restated its financial statements as of and for the six-month
period ended June 30, 2005 to include the effects of this increased stock-based
compensation charge.  In Amendment No. 4, the Registrant has revised the
disclosure in the Management's Discussion and Analysis of Financial Condition
and Results of Operations section and in its financial statements to reflect
the restatement.  In appropriate locations throughout Amendment No. 4, the
Registrant has included disclosure to the effect that its six-month results
were restated to reflect the higher compensation charge.  Please refer to pages
7, 46, 48, 55-57, 62, 63, F-15 and F-17 of Amendment No. 4.

3.      Please describe to us the factors that resulted in the 26% increase in
        fair value from the $14.30 that was used in June to $18.00 in July.
        Please include more specific quantitative and qualitative information
        beyond that provided in your response letter dated September 22, 2005.

Response: As noted in the response to Comment No. 2 above, the Registrant
reassessed the fair value of its common stock as of May and June 2005 and
determined a fair value of $17.10, which was calculated using a 5% illiquidity
discount to the then expected mid-point of the range of $18.00 per share.

<PAGE>

November 14, 2005
Page 3
Latham & Watkins LLP

4.      Describe, in reasonable detail, all of the material assumptions used in
        January 2005 to arrive at the prospective fair value of $14.30
        subsequently used in May 2005 and explain how each of those
        assumptions compared to actual company conditions that existed in May.
        In addition, explain to us why, in your retrospective determination of
        fair value, the valuation performed back in January represented a
        better estimate of the fair value in May than the estimates used by
        your underwriters and board of directors in July.

Response: As noted in the response to Comment No. 2 above, the Registrant
reassessed the fair value of its common stock as of May and June 2005 and
determined a fair value of $17.10, which was calculated using a 5% illiquidity
discount to the then expected mid-point of the range of $18.00 per share.

                                  * * * * *

        In addition, the Registrant informs the Staff that during the review of
its consolidated financial statements for the nine months ended September 30,
2005, the Registrant identified approximately $0.5 million of revenue that
should have been recorded during the six months ended June 30, 2005.  As a
result of the foregoing, the Registrant has restated its consolidated financial
statements as of and for the six months ended June 30, 2005 (please see Note 3
to the Registrant's consolidated financial statements included in Amendment No.
4).  Prior to such restatement, the Registrant recorded revenue in July 2005
for certain products of ALG, a recently acquired subsidiary, that were shipped
in June 2005.  Under the Registrant's accounting policy and applicable GAAP,
the revenue should have been recorded at the time of shipment in June.  In
response to this discovery, the Registrant reviewed revenue cut-off for the
periods from the date of acquisition through September 30, 2005 at each of ALG,
NAT and Chrome and found no other instances of improper timing of revenue
recognition.

        In connection with the restatement, the Registrant identified matters
that constitute material weaknesses in the design and operation of its internal
control over financial reporting.  The material weaknesses the Registrant
identified are that its accounting and finance staff at ALG did not maintain
effective controls over recognition of revenue as it relates to cut-off at ALG.
Specifically, the Registrant did not reconcile shipments to customers with
revenue recognized in the period.  In addition, the Registrant did not
adequately review and analyze subsidiary financial information at a sufficient
level of detail to detect a material error.  The Registrant has added a risk
factor to Amendment No. 4, as well as disclosure in the Management's Discussion
and Analysis of Financial Condition and Results of Operations section and in
its financial statements to reflect the restatement.  To remediate these
material weaknesses, the Registrant will take steps to supplement and train its
accounting and finance staff and is in the process of updating its internal
policies and procedures in an effort to further enhance and formalize its
disclosure controls and procedures and internal control over financial
reporting.  Please refer to pages 7, 20, 46, 48, 62, 63, 67, 68, F-17 and F-18
of Amendment No. 4.

                                  * * * * *

                 [Remainder of page intentionally left blank]

<PAGE>

November 14, 2005
Page 4
Latham & Watkins LLP

        We hope the foregoing answers are responsive to your comments and look
forward to resolving any outstanding issues as quickly as possible.  If you
have any questions in connection with our responses to your comments, please
feel free to call me at (212) 906-1284, Daniel Nam at (212) 906-1703 or Jason
Frank at (212) 906-1796.  Thank you again for your assistance.

                                           Sincerely,

                                           /s/  Kirk A. Davenport II

                                           Kirk A. Davenport II
                                           of LATHAM & WATKINS LLP

Enclosures

cc:      Stathis Kouninis, U.S. Securities and Exchange Commission
         Barbara C. Jacobs, Esq., U.S. Securities and Exchange Commission
         Rebekah Toton, Esq., U.S. Securities and Exchange Commission
         Eric D. Jacobs, Esq., DealerTrack Holdings, Inc.
         John J. Huber, Esq., Latham & Watkins LLP
         Daniel U. Nam, Esq., Latham & Watkins LLP
         Jason S. Frank, Esq., Latham & Watkins LLP
         Richard D. Truesdell, Jr., Esq., Davis Polk & Wardwell
</TEXT>
</DOCUMENT>