Lithia Motors (LAD) Rating Lowered to Sell at Zacks Investment Research

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Zacks Investment Research cut shares of Lithia Motors (NYSE:LAD) from a hold rating to a sell rating in a research note released on Monday.

According to Zacks, “Lithia Motors’ decline in new vehicles, owing to distribution disruption and availability of abundant used-vehicles in the market, are hampering sales. The company also faces strong competitionpublicly and privately-owned dealerships. Rising competition and increasing price transparency can lead to lower selling prices, thus affecting the company’s profits. Over the past year, shares of the company have underperformed the industry it belongs to.”

A number of other analysts have also commented on LAD. ValuEngine upgraded Lithia Motors from a strong sell rating to a sell rating in a report on Tuesday, December 25th. TheStreet upgraded Lithia Motors from a c+ rating to a b- rating in a report on Tuesday, January 29th. Seaport Global Securities started coverage on Lithia Motors in a report on Wednesday, February 13th. They set a buy rating and a $110.00 price target on the stock. Finally, JPMorgan Chase & Co. started coverage on Lithia Motors in a report on Tuesday, February 19th. They set an overweight rating and a $112.00 price target on the stock. Two investment analysts have rated the stock with a sell rating, one has assigned a hold rating and seven have given a buy rating to the stock. The company currently has a consensus rating of Buy and an average price target of $106.29.

Shares of Lithia Motors stock opened at $88.85 on Monday. The firm has a market cap of $2.02 billion, a P/E ratio of 8.90, a price-to-earnings-growth ratio of 1.02 and a beta of 1.19. Lithia Motors has a 12 month low of $67.90 and a 12 month high of $105.64. The company has a debt-to-equity ratio of 1.13, a quick ratio of 0.25 and a current ratio of 1.20.

Lithia Motors (NYSE:LAD) last issued its quarterly earnings results on Wednesday, February 13th. The company reported $2.57 EPS for the quarter, topping the Zacks’ consensus estimate of $2.45 by $0.12. The business had revenue of $2.97 billion for the quarter, compared to analyst estimates of $3.01 billion. Lithia Motors had a return on equity of 20.82% and a net margin of 2.25%. Lithia Motors’s quarterly revenue was up 10.0% compared to the same quarter last year. During the same period last year, the company posted $2.15 earnings per share. Research analysts anticipate that Lithia Motors will post 10.24 EPS for the current year.

The company also recently announced a quarterly dividend, which will be paid on Friday, March 22nd. Shareholders of record on Friday, March 8th will be paid a $0.29 dividend. The ex-dividend date of this dividend is Thursday, March 7th. This represents a $1.16 annualized dividend and a dividend yield of 1.31%. Lithia Motors’s payout ratio is presently 11.62%.

In other Lithia Motors news, CEO Bryan B. Deboer sold 3,835 shares of the business’s stock in a transaction on Tuesday, February 26th. The stock was sold at an average price of $90.00, for a total value of $345,150.00. Following the sale, the chief executive officer now directly owns 153,285 shares in the company, valued at $13,795,650. The sale was disclosed in a filing with the SEC, which is accessible through this link. Also, Director Susan O. Cain sold 1,462 shares of the business’s stock in a transaction on Friday, February 15th. The shares were sold at an average price of $87.15, for a total value of $127,413.30. Following the completion of the sale, the director now owns 10,849 shares in the company, valued at $945,490.35. The disclosure for this sale can be found here. Insiders own 5.21% of the company’s stock.

Several institutional investors and hedge funds have recently modified their holdings of LAD. Abrams Capital Management L.P. raised its stake in shares of Lithia Motors by 92.2% in the third quarter. Abrams Capital Management L.P. now owns 2,000,000 shares of the company’s stock valued at $163,320,000 after buying an additional 959,673 shares during the period. Lakewood Capital Management LP raised its stake in shares of Lithia Motors by 67.5% during the 4th quarter. Lakewood Capital Management LP now owns 769,169 shares of the company’s stock valued at $58,711,000 after purchasing an additional 310,000 shares during the period. Norges Bank bought a new stake in shares of Lithia Motors during the 4th quarter valued at $16,564,000. Dimensional Fund Advisors LP raised its stake in shares of Lithia Motors by 17.8% during the 4th quarter. Dimensional Fund Advisors LP now owns 1,323,683 shares of the company’s stock valued at $101,036,000 after purchasing an additional 200,381 shares during the period. Finally, Tyvor Capital LLC raised its stake in shares of Lithia Motors by 377.8% during the 3rd quarter. Tyvor Capital LLC now owns 236,015 shares of the company’s stock valued at $19,273,000 after purchasing an additional 186,620 shares during the period.

Lithia Motors Company Profile

Lithia Motors, Inc operates automotive franchises, and retails new and used vehicles in the United States. The company operates in three segments: Domestic, Import, and Luxury. It sells new and used cars, replacement parts, vehicle service contracts, vehicle protection products, and credit insurance products; provides vehicle maintenance, warranty, paint, and repair services; and arranges related financing.

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