Lithia Motors, Inc. (LAD) AI Stock Analysis

Lithia Motors, Inc. is an automotive retailer organized into three distinct segments: Domestic, Import, and Luxury. The company offers a wide selection of new and used vehicles alongside comprehensive automotive services, such as financing solutions, warranties, insurance contracts, and vehicle protection services. In addition, Lithia Motors provides vehicle repair and maintenance services under the Driveway and GreenCars brands. It leverages a digital network of over 300 websites to facilitate online vehicle transactions for customers across the United States. Founded in 1946 and headquartered in Medford, Oregon, the company employs approximately 30,000 people.

Lithia Motors expanded revenue from $22.83B in FY2021 to $37.63B in FY2025, producing a 5-year revenue CAGR of 23.4%. However, annual revenue growth slowed from 73.9% in FY2021 and 16.6% in FY2024 to 4.0% in FY2025. Gross margin contracted from 18.7% in FY2021 to 15.2% in FY2025, while operating margin fell from 7.3% to 3.8% over the same timeframe. Net income peaked at $1.25B in FY2022 before settling at $819.6M in FY2025 with an EPS of $34.14. In the latest quarter ended June 30, 2026, revenue increased 2.2% year-over-year, while quarterly earnings grew 16.9% year-over-year.

As of June 30, 2026, Lithia Motors held $363.9M in cash and short-term investments against total debt of $16.56B, resulting in net debt of $16.20B and a debt-to-equity ratio of 2.58. Total assets were $26.25B against shareholders' equity of $6.43B, with a current ratio of 1.00. In FY2025, operating cash flow stood at $356.7M, supporting capital expenditures of $350.9M and yielding free cash flow of $5.8M. Lithia Motors allocated $960.9M to share buybacks and $55.3M to dividends in FY2025, contributing to a 5-year share count reduction of 26.0%.

At $295.14, Lithia Motors has a market cap of $6.49B and trades at a trailing P/E of 9.8x and a forward P/E of 7.9x. These multiples sit below the median of its US-listed Consumer Cyclical peers, which record a trailing P/E of 18.0x and a forward P/E of 14.1x. Its price-to-sales ratio of 0.2x and EV/EBITDA of 10.5x also compare to peer medians of 0.7x and 11.1x, respectively. The stock has underperformed broader benchmarks, dropping 2.7% over the past year and 9.4% over five years, compared to gains of 16.8% and 83.0% for the S&P 500 (SPY).

Lithia Motors pays a forward annual dividend of $2.80 per share, representing a dividend yield of 0.95% and a payout ratio of 7.0%. The dividend is distributed quarterly and has been paid for 17 consecutive years, with a 5-year annualized dividend growth rate of 12.3%. The most recent ex-dividend date occurred on August 7, 2026.

Wall Street coverage consists of 8 Strong Buy, 2 Buy, and 5 Hold ratings, with zero Sell or Strong Sell ratings. The mean price target of $409.07 reflects a 38.6% premium over the last close of $295.14. For the current fiscal year ending December 31, 2026, consensus estimates project revenue of $38.30B and EPS of $35.71, representing 6.7% EPS growth. Lithia Motors has beaten EPS estimates in 3 of the last 4 quarters, and its next earnings release is scheduled for October 21, 2026.

This page is an AI-written research summary of Lithia Motors, Inc. (LAD). The text was generated on October 30, 2026 from Quotelinks data as of October 16, 2026 (company profile, annual results, latest balance sheet, valuation, price performance and analyst estimates). An automatic check rejects any draft that contains a figure not found in that data. It is not investment advice; verify figures on the linked tabs before making decisions.

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