Start here if you're new
what it is
Lithia runs 344 dealerships, sells new and used cars, arranges financing, and services the vehicles after you buy them.
how it gets paid
Last year Lithia Motors made $37.6B in revenue. New vehicles was the main engine at $19.3B, or 51% of sales.
why it's growing
Revenue grew 4.0% last year. Used vehicle revenue was even stronger, climbing 12%, supported by mid-single-digit gains in unit volume and pricing.
what just happened
Lithia's last reported quarter was a miss, with EPS at $6.74 versus an $8.25 estimate.
At a glance
B balance sheet — gets the job done, barely
60/100 earnings predictability — reasonably predictable
9.2x trailing p/e — the market's not buying it — or you found a deal
0.7% dividend yield — cash in your pocket every quarter
7.0% return on capital — nothing to write home about
xvary composite: 62/100 — average
What they do
Lithia runs 344 dealerships, sells new and used cars, arranges financing, and services the vehicles after you buy them.
Lithia wins because it keeps more of your car life in one place. If you need a car, a trade-in, financing, and service, 344 stores across the U.S. give it more chances to keep your whole transaction inside. Scale matters here: $37.6 billion in annual revenue gives it more inventory reach and ad muscle than a small local dealer.
How they make money
$37.6B
annual revenue · their business grew +4.0% last year
New vehicles
$19.3B
+5.5%
Used vehicles
$12.8B
+12.0%
Service, body, and parts
$2.9B
+4.0%
Finance and insurance
$2.1B
+4.0%
Fleet and other
$0.5B
+4.0%
The products that matter
new and used vehicle retail
Vehicle Retail
$37.6B revenue
it's the line that defines the company, tied to the business that accounts for 94% of revenue. this page only gives you one clean segment story because the retail engine is still the whole story.
94% of revenue
Key numbers
$38.10
fy2026 eps
EPS → profit per share → so what: even using the $38.10 estimate, the stock trades at about 8.6 times that profit, which is cheap for a company still expected to grow sales.
9.2x
trailing p/e
P/E → stock price divided by annual profit → so what: you are paying 9.2 years of current earnings for a business expected to reach $45 billion in revenue by FY2028.
$9.2B
long-term debt
Long-term debt → money owed beyond one year → so what: the balance sheet carries more debt than the company's roughly $8 billion market value.
7.0%
operating margin
Operating margin → profit after running the business, before interest and taxes → so what: this is a volume business where small pricing mistakes matter.
Financial health
B
strength
- balance sheet grade B — adequate — nothing special
- risk rank 3 — safer than 50% of stocks
- price stability 50 / 100
- long-term debt $9.2B (53% of capital)
- net profit margin 2.3% — keeps 2 cents of every dollar in revenue
- return on equity 12% — $0.12 profit for every $1 investors have put in
B — functional but not a standout on the balance sheet.
Total return vs. market
You invested $10,000 in LAD 3 years ago → it's now worth $16,320.
The index would have given you $14,770.
source: institutional data · total return
What just happened
missed estimates
Lithia's last reported quarter was a miss, with EPS at $6.74 versus an $8.25 estimate.
That is an 18.3% miss versus expectations. The weird part is revenue still rose, with the latest reported quarter at $9.68 billion and annual revenue at $37.6 billion.
$9.68B
revenue
$6.74
eps
15.3%
gross margin
the number that mattered
The 18.3% EPS miss matters most because this stock is cheap partly due to trust issues, and misses keep that discount alive.
-
lithia motors delivered solid third-quarter results.
-
revenue rose 5% vs. prior year, to $9.68 billion, driven largely by continued acquisition activity and sustained strength in aftersales and finance and insurance (f&i).
-
on a same-store basis, new vehicle revenue increased 5.5%, reflecting a mid-single-digit rise in average selling prices and a low-single-digit unit growth.
-
used vehicle revenue was even stronger, climbing 12%, supported by mid-single-digit gains in unit volume and pricing.
-
adjusted earnings per share advanced nearly 17% vs. prior year, to $9.50.note: we have transitioned to reporting adjusted share earnings beginning in 2025, limiting comparability with prior gaap figures.
source: company earnings report, 2026
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What could go wrong
the top risk is a low-margin retail model carrying $9.2B in long-term debt.
high
thin-margin model
lithia turned $37.6B in revenue into a 2.3% net margin. that leaves very little cushion if pricing softens, used-car spreads compress, or operating costs climb.
when your margin starts at 2.3%, small execution misses show up fast in earnings.
high
balance sheet pressure
long-term debt sits at $9.2B, or 53% of capital. that is manageable in a healthy market and less comfortable if sales slow while financing stays expensive.
debt does not need to become a crisis to weigh on the stock. it only needs to limit flexibility.
med
consumer financing demand
this is still a car-selling business. if financing gets tougher for buyers, volume slows and the fixed-cost dealership base has less room to hide.
the problem would hit both revenue growth and confidence in the $38.10 EPS estimate.
med
revenue concentration
one segment makes up 94% of revenue. that means there is no large side business here to smooth out a weak auto retail cycle.
if vehicle retail stalls, most of the income statement feels it at once.
these risks sit on top of $37.6B in revenue, but only a 2.3% net margin. this is a volume story with very little room for mistakes.
source: institutional data · regulatory filings · risk analysis
Pay attention to
earnings
next quarterly print
watch whether EPS stays close to the recent $8.61 quarterly pace and whether management still sounds confident around the $38.10 full-year setup.
trend
same-store sales growth
this tells you whether existing dealerships are selling more, not just whether the company got bigger on paper.
risk
rates and financing pressure
if financing stays tough for car buyers, demand softens first and margin pressure usually follows.
metric
gross profit per unit
when margins are thin, profit on each vehicle matters more than top-line bragging rights.
Analyst rankings
short-term outlook
top 20%
momentum score 2 — in human-speak, analysts expect better price performance than most stocks over the next year.
risk profile
average
stability score 3 — this sits in the middle of the pack, not especially defensive and not chaos either.
chart momentum
top 20%
technical score 2 — the chart has held up better than you might expect for a stock that already visited $251.
earnings predictability
60 / 100
the earnings record is decent, but not smooth. you should expect a real chance of surprises.
source: institutional data
Institutional activity
institutions have been net selling for 2 consecutive quarters — 202 buyers vs. 228 sellers in 3q2025. total institutional holdings: 24.7M shares. net selling for 2 quarters.
source: institutional data
Price targets
3-5 year target range
$255
$543
$329
current price
$399
target midpoint · +21% from current · 3-5yr high: $555 (+70% · 14% ann'l return)
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