Morningstar

Lithia Motors Inc Class A LAD

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Stock XNYS Rating as of
$306.07 +14.24 (4.88%)
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As of Delayed Price Closed

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We See Lithia as a Powerful Operator With a Long Growth Runway

David Whiston

Lithia Motors' business model is strong because it is the only large publicly traded dealer operating in rural and metro markets. Rural markets are unattractive to larger public dealers, as their management teams have no interest in small cities and they have import and luxury brand mixes more favorable to suburban markets. Nationwide, many Lithia brand stores have no competitors within 100 miles, giving Lithia pricing power.

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Price vs Fair Value

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LAD is trading at a LOCK|hk%v@% premium.
Price
$306.07
Fair Value
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Uncertainty
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1-Star Price
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5-Star Price
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Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

Lithia’s growth runway looks very long to us; acquisitions are opening up new areas of the US, and international expansion has started by entering Canada in 2021 and the UK in 2023.

Bears

Lithia could need additional capital to fund expansion. In addition, it will face increased competition for acquisitions now that it will operate in large cities.

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Trading Information

Previous Close Price
$291.83
Day Range
$287.57–308.57
52-Week Range
$239.78–439.49
Bid/Ask
$284.25 / $320.00
Shares Outstanding
21.98M
Market Cap
$6.73B
Volume/Avg
402,887 / 291,875

Key Statistics

Price/Earnings (Normalized)
9.11
Price/Sales
0.19
Dividend Yield (Trailing)
0.77%
Dividend Yield (Forward)
0.91%
Dividend Payment Schedule
Mar, May, Aug, Nov
Total Yield
18.66%

Company Profile

Lithia Motors is a retailer of new and used vehicles and related services. The company offers nearly 60 brands of vehicles at nearly 500 stores globally across the US, Canada, and UK. The company has expanded largely through the acquisition of dealerships in smaller regional markets but now seeks to grow in any part of the US. We expect more deals over time in the US and, at times, abroad. Annual revenue in 2025 was $37.6 billion, and we see over $50 billion possible in a few years. The US was 78.5% of 2025 revenue and the UK second at 18.4%, due to the 2024 Pendragon acquisition. In 2025, new vehicle sales were about 50% of total revenue. Lithia was founded in 1946, went public in 1996, and is the largest US auto dealer. It is based in Medford, Oregon.
Sector
Consumer Cyclical
Industry
Auto & Truck Dealerships
Stock Style Box
Small Value
Total Number of Employees
30,000
Website
https://www.lithia.com

Competitors

Valuation

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Metric
LAD
BRK.B
KMX
Price/Earnings (Normalized)
 9.1122.5118.07
Price/Book Value
 1.051.441.26
Price/Sales
 0.192.460.29
Price/Cash Flow
 5.3626.532.83
Price/Earnings
LAD
BRK.B
KMX

Financial Strength

Metric
LAD
BRK.B
KMX
Quick Ratio
 0.18—0.18
Current Ratio
 1.00—2.33
Interest Coverage
 1.5321.59−0.57
Quick Ratio
LAD
BRK.B
KMX

Profitability

Metric
LAD
BRK.B
KMX
Return on Assets (Normalized)
 3.17%7.02%1.90%
Return on Equity (Normalized)
 12.05%12.09%8.17%
Return on Invested Capital (Normalized)
 4.52%10.72%−0.45%
Return on Assets
LAD
BRK.B
KMX

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