Lithia Motors Reports Mixed Quarter Amid New Vehicle Sales Decline
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Feb 11 2026
0mins
Should l Buy LAD?
Source: Benzinga
Lithia Motors Inc. saw its stock drop 3.06% as it hit a 20-day low, reflecting investor concerns following its recent financial report.
The company reported a 6.1% increase in used vehicle sales, but new vehicle sales fell 5.7% year-over-year, raising questions about future profitability. Despite these challenges, Lithia's commitment to shareholder returns was evident as it repurchased over 11% of its outstanding shares and declared a quarterly dividend of $0.55 per share, indicating a stable cash flow.
The mixed results highlight the need for strategic adjustments in response to the declining new vehicle market, while the strong performance in used vehicle sales may provide a buffer against potential profitability pressures.
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Analyst Views on LAD
Wall Street analysts forecast LAD stock price to rise
8 Analyst Rating
6 Buy
2 Hold
0 Sell
Strong Buy
Current: 251.950
Low
310.00
Averages
388.00
High
500.00
Current: 251.950
Low
310.00
Averages
388.00
High
500.00
About LAD
Lithia Motors, Inc. is a global automotive retailer. The Company is engaged in providing an array of products and services throughout the vehicle ownership lifecycle. The Company offers convenient experiences through its comprehensive network of physical locations, e-commerce platforms, captive finance solutions and other synergistic adjacencies. The Company operates through two segments: Vehicle Operations and Financing Operations. Its Vehicle Operations consist of all aspects of its auto merchandising and service operations, including its retail automotive, recreational vehicles, and motorcycle franchises that sell new vehicles, used vehicles, parts, repair and maintenance services, and vehicle finance and insurance products. Its Financing Operations segment provides financing to customers buying and leasing retail vehicles from its Vehicle Operations. It operates approximately 464 locations representing 52 brands across the United States, the United Kingdom, and Canada.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Support Details: The funds will be used for new equipment, technology, and curriculum needs, aimed at enhancing students' career readiness while providing hands-on experiences alongside Lithia dealers and employees.
- Community Engagement: Nearly all Lithia dealerships in the supported communities have interacted directly with students over the past month, participating in networking events and on-site check presentations, strengthening ties between the company and educational institutions.
- Corporate Philosophy: CEO Bryan DeBoer emphasized that supporting automotive programs is a natural extension of the company's growth philosophy centered on people, aiming to cultivate future employees and give back to the community.
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- Historical Price Comparison: While used vehicle prices remain high compared to historical levels, the average listing price in January was $25,533, down from over $28,000 in 2022, yet still demonstrating market resilience, with expectations for wholesale prices to end 2% higher than December 2025.
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Lithia & Driveway Acquires Two Auto Dealerships
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- Revenue Growth Potential: These acquisitions bring Lithia & Driveway's year-to-date annualized U.S. revenue to $225 million, indicating the company's proactive progress in expanding its business footprint.
- Financing Strategy: The acquisitions were financed using existing on-balance sheet capacity, demonstrating Lithia & Driveway's robust financial management and ability to support future expansion plans.
- Future Strategic Direction: Lithia & Driveway aims for an annual M&A target of $2 billion to $4 billion while accelerating buybacks and DFC penetration, reflecting the company's strong commitment to seizing market opportunities.
See More
Lithia & Driveway Acquires Two Automotive Dealerships
- Market Expansion: Lithia & Driveway's acquisition of Toyota of Gallatin in Tennessee and Mercedes-Benz of Medford in Oregon strengthens its portfolio across luxury and core volume brands, further solidifying its presence in its hometown market.
- Revenue Growth: These acquisitions bring Lithia & Driveway's total year-to-date annualized U.S. revenue to $225 million, demonstrating the company's ongoing ability to expand in high-growth markets and reflecting its strong competitive position.
- Strategic Significance: The acquisition of the Toyota dealership marks the company's entry into the fast-growing Nashville market, while the addition of the Mercedes-Benz dealership is particularly meaningful as it coincides with the company's 80th anniversary, showcasing its commitment to its hometown market.
- Financing Method: The acquisitions were financed using existing on-balance sheet capacity, indicating the company's financial stability and flexibility, which lays a solid foundation for future expansions.
See More
Market Dynamics and Investment Strategy Recap
- Inflation Data Impact: On Wednesday, the S&P 500 drifted lower as investors weighed key consumer inflation data against the ongoing U.S.-Iran war and volatile oil prices; although the February CPI report met expectations, concerns about future data intensified, particularly regarding the surge in energy prices driven by the war not reflected in current figures.
- Oil Price Volatility and Market Response: The International Energy Agency announced plans to release 400 million barrels of oil from reserves to address supply disruptions, providing temporary market relief, yet oil prices still rose on Wednesday, indicating ongoing market concerns about energy supply, with Jim Cramer noting a strategy to deploy cash during oversold conditions.
- CrowdStrike Stock Outlook: CrowdStrike shares rose roughly 1% in the morning, but Jim argued the stock should be trading significantly higher due to increasing discussions around AI agents and potential security breaches, particularly with the open-source AI agent OpenClaw gaining popularity in China, emphasizing CrowdStrike's technological edge in this area.
- Eli Lilly Price Target Increase: Wolfe Research raised its price target on Eli Lilly from $1,250 to $1,325, implying about a 32% upside, and while Jim noted investors might overlook this bullish note amid geopolitical uncertainty and inflation concerns, he agreed with the massive market opportunity for Lilly's drug, highlighting that the company is prepared to meet demand with its factories ready.
See More
Lithia & Driveway Donates $500,000 to Automotive Education Programs
- Donation Amount: Lithia & Driveway announced a donation of over $500,000 to automotive programs nationwide, with 11 colleges each receiving $50,000 to support student success and career development.
- Support Details: The funds will be used for new equipment, technology, and curriculum needs, aimed at enhancing students' career readiness while providing hands-on experiences alongside Lithia dealers and employees.
- Community Engagement: Nearly all Lithia dealerships in the supported communities have interacted directly with students over the past month, participating in networking events and on-site check presentations, strengthening ties between the company and educational institutions.
- Corporate Philosophy: CEO Bryan DeBoer emphasized that supporting automotive programs is a natural extension of the company's growth philosophy centered on people, aiming to cultivate future employees and give back to the community.
See More
Used Vehicle Price Index Rises 4%
- Index Increase: Cox Automotive reported a 4% year-over-year increase in the used vehicle price index for February 2026, reaching 212.3, which is up 0.8% from January 2023, indicating strong demand and an increase in dealer inventories.
- Sales Conversion Rates Rise: Jeremy Robb, Cox's chief economist, noted that since the beginning of 2026, sales conversion rates at Manheim have been solid, reflecting dealers' strong appetite for purchasing, particularly with prices rising unexpectedly in the latter half of February.
- Tax Refund Impact: Robb suggested that anticipated higher tax returns for American consumers could boost vehicle demand, although risks from the war in Iran may dampen consumer appetite in the short term, especially as gas prices rise.
- Historical Price Comparison: While used vehicle prices remain high compared to historical levels, the average listing price in January was $25,533, down from over $28,000 in 2022, yet still demonstrating market resilience, with expectations for wholesale prices to end 2% higher than December 2025.
See More
U.S. Oil Prices Surge, Market Eyes Jobs Data
- Oil Price Surge: U.S. oil futures have surged to their highest level since 2024, creating anticipation in the market that could impact overall economic sentiment and investor confidence.
- Jobs Data Expectations: The February payroll report is set to be released, with a consensus forecast of 50,000 new jobs, although some experts suggest a potential negative number, indicating a cautious outlook on economic recovery.
- Robinhood Stock Fluctuations: Robinhood's stock is down 47% from its October peak but has gained 67% over the past year, indicating a gradual recovery in investor confidence, further bolstered by positive comments from the CEO.
- Biotech Industry Challenges: The biotech ETF and related indices have declined by 6.2% and 11% respectively since January highs, reflecting pressures from recent FDA rejections, prompting investors to closely monitor market reactions.
See More
Lithia & Driveway Acquires Two Auto Dealerships
- Acquisition Overview: Lithia & Driveway has acquired Toyota of Gallatin in Tennessee and Mercedes-Benz of Medford in Oregon, further strengthening the company's market position through these strategic transactions.
- Revenue Growth Potential: These acquisitions bring Lithia & Driveway's year-to-date annualized U.S. revenue to $225 million, indicating the company's proactive progress in expanding its business footprint.
- Financing Strategy: The acquisitions were financed using existing on-balance sheet capacity, demonstrating Lithia & Driveway's robust financial management and ability to support future expansion plans.
- Future Strategic Direction: Lithia & Driveway aims for an annual M&A target of $2 billion to $4 billion while accelerating buybacks and DFC penetration, reflecting the company's strong commitment to seizing market opportunities.
See More
Lithia & Driveway Acquires Two Automotive Dealerships
- Market Expansion: Lithia & Driveway's acquisition of Toyota of Gallatin in Tennessee and Mercedes-Benz of Medford in Oregon strengthens its portfolio across luxury and core volume brands, further solidifying its presence in its hometown market.
- Revenue Growth: These acquisitions bring Lithia & Driveway's total year-to-date annualized U.S. revenue to $225 million, demonstrating the company's ongoing ability to expand in high-growth markets and reflecting its strong competitive position.
- Strategic Significance: The acquisition of the Toyota dealership marks the company's entry into the fast-growing Nashville market, while the addition of the Mercedes-Benz dealership is particularly meaningful as it coincides with the company's 80th anniversary, showcasing its commitment to its hometown market.
- Financing Method: The acquisitions were financed using existing on-balance sheet capacity, indicating the company's financial stability and flexibility, which lays a solid foundation for future expansions.
See More
