Lithia & Driveway Q1 Earnings Exceed Expectations
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1 hour ago
0mins
Should l Buy LAD?
Source: seekingalpha
- Earnings Beat: Lithia & Driveway reported a Q1 non-GAAP EPS of $7.34, surpassing expectations by $0.48, which underscores the company's robust profitability and enhances investor confidence.
- Revenue Growth: The company achieved Q1 revenue of $9.3 billion, reflecting a 1.1% year-over-year increase and exceeding market expectations by $80 million, indicating its ability to maintain stable revenue growth in a competitive market.
- Used Vehicle Revenue Surge: Used vehicle revenue increased by 4.6% on a same-store basis, while retail gross profit per unit (GPU) rose by 9%, or $133 sequentially, demonstrating strong performance and effective cost management in the used car market.
- Record Financing Achievements: Driveway Finance Corporation reached record originations of $840 million with an 18.0% penetration rate and an average FICO score of 750, showcasing the company's strong competitiveness and market acceptance in the financial services sector.
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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: 276.860
Low
310.00
Averages
388.00
High
500.00
Current: 276.860
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.
Lithia Motors Q1 Earnings Announcement Scheduled
- Earnings Release Date: Lithia Motors (LAD) is set to announce its Q1 earnings on April 29 before market open, with a consensus EPS estimate of $6.86, reflecting a 10.4% year-over-year decline, which could impact investor sentiment.
- Revenue Expectations: The revenue estimate for Q1 stands at $9.22 billion, representing a modest 0.2% year-over-year increase, indicating the company's stability in the market, which may attract investors looking for reliable stocks.
- Historical Performance: Over the past two years, LAD has beaten EPS and revenue estimates 63% of the time, showcasing consistency in financial performance that could bolster market confidence in its future results.
- M&A Strategy: Lithia Motors signals an annual M&A target of $2 billion to $4 billion while accelerating buybacks and DFC penetration, a strategy that aims to drive growth and enhance shareholder value in a competitive landscape.
See More
Lithia & Driveway Q1 Earnings Exceed Expectations
- Earnings Beat: Lithia & Driveway reported a Q1 non-GAAP EPS of $7.34, surpassing expectations by $0.48, which underscores the company's robust profitability and enhances investor confidence.
- Revenue Growth: The company achieved Q1 revenue of $9.3 billion, reflecting a 1.1% year-over-year increase and exceeding market expectations by $80 million, indicating its ability to maintain stable revenue growth in a competitive market.
- Used Vehicle Revenue Surge: Used vehicle revenue increased by 4.6% on a same-store basis, while retail gross profit per unit (GPU) rose by 9%, or $133 sequentially, demonstrating strong performance and effective cost management in the used car market.
- Record Financing Achievements: Driveway Finance Corporation reached record originations of $840 million with an 18.0% penetration rate and an average FICO score of 750, showcasing the company's strong competitiveness and market acceptance in the financial services sector.
See More
Lithia & Driveway Reports Strong Q1 Results with $9.3 Billion Revenue
- Revenue Growth: Lithia & Driveway reported first-quarter revenues of $9.3 billion, reflecting a 1% increase from the previous year, indicating the company's stable performance in the automotive retail market despite economic challenges.
- Used Vehicle Sales Surge: Used vehicle revenue increased by 4.6% year-over-year, showcasing strong same-store sales performance and further solidifying the company's market position.
- Profitability Decline: The first quarter diluted earnings per share were $4.28, a 46% decrease year-over-year primarily due to investment losses, although the adjusted EPS of $7.34 demonstrates the resilience of core operations.
- Share Buybacks and Dividends: The company repurchased approximately $259 million in shares, representing 4% of outstanding shares, and declared a dividend of $0.57 per share, reflecting a commitment to shareholder returns.
See More
Lithia Motors Expected to Announce Dividend Increase
- Dividend Growth Expectation: Lithia Motors is expected to announce a dividend increase this April, continuing its 15-year streak of consistent growth, with analysts projecting an annual dividend of approximately $2.26 per share, translating to a quarterly dividend of about $0.565, reflecting a 2.7% increase from the current $0.55 payout.
- Historical Performance Analysis: Over the past five years, the company has achieved a dividend growth rate of around 12.33%, maintaining a payout ratio of 6.44%, which indicates its stability and sustainability in dividend payments.
- Safety Ratings: According to dividend metrics ratings, Lithia Motors holds an A+ for safety, a C+ for growth, a D+ for yield, and a B+ for consistency, suggesting a strong assurance in its dividend payment safety.
- Investor Focus: Investors should closely monitor the upcoming Q1 2026 results set to be released on April 29, 2026, which will provide crucial insights into the company's future dividend policies and financial health.
See More
US Navy Seizes Iranian Cargo Ship, Sparking Market Concerns
- Navy Seizure Incident: President Trump announced the U.S. Navy seized an Iranian cargo ship, leading to a cautious market sentiment as investor concerns about Middle Eastern tensions rise, causing oil prices to increase and potentially impacting consumer spending.
- Oil Price Warning: The Energy Secretary warned that gas prices could remain above $3 per gallon until next year, which would negatively affect consumers already feeling the pinch of high costs, further impacting economic recovery.
- Tech and Finance Intersection: Kevin Warsh, Trump's nominee for Federal Reserve Chair, is set for a Senate confirmation hearing, and his close ties to Silicon Valley could change the interaction between tech giants and the Fed, influencing future monetary policy.
- Automotive Dealer Consolidation Trend: Data shows that the top 150 auto dealers in the U.S. increased their market share from 21.2% a decade ago to 27%, reflecting the rise of mega-dealers and the struggles of smaller competitors, potentially leading to significant industry structural changes.
See More
US Navy Seizes Iranian Cargo Ship, Market Sentiment Shifts
- Navy Seizure Incident: President Trump announced that the U.S. Navy seized an Iranian cargo ship in the Gulf of Oman, shifting market sentiment to a defensive stance as investor concerns about Middle Eastern tensions rise, leading to higher oil prices and downward pressure on stock futures.
- Oil Price Warning: Amid fears of escalating tensions in the Middle East, oil prices are rising, with the Energy Secretary warning that gas prices could remain above $3 per gallon until next year, further straining consumers already facing higher costs.
- Tech Ties and Fed: Kevin Warsh, Trump's nominee for the Federal Reserve chair, will face confirmation hearings tomorrow, with his close ties to Silicon Valley raising questions about potential access for tech moguls to the Fed, a point of significant market interest.
- Dealer Consolidation: Data shows that the top 150 car dealerships in the U.S. increased their market share from 21.2% a decade ago to 27%, reflecting a trend of consolidation that benefits larger dealers like Lithia Motors and AutoNation.
See More
Lithia Motors Q1 Earnings Announcement Scheduled
- Earnings Release Date: Lithia Motors (LAD) is set to announce its Q1 earnings on April 29 before market open, with a consensus EPS estimate of $6.86, reflecting a 10.4% year-over-year decline, which could impact investor sentiment.
- Revenue Expectations: The revenue estimate for Q1 stands at $9.22 billion, representing a modest 0.2% year-over-year increase, indicating the company's stability in the market, which may attract investors looking for reliable stocks.
- Historical Performance: Over the past two years, LAD has beaten EPS and revenue estimates 63% of the time, showcasing consistency in financial performance that could bolster market confidence in its future results.
- M&A Strategy: Lithia Motors signals an annual M&A target of $2 billion to $4 billion while accelerating buybacks and DFC penetration, a strategy that aims to drive growth and enhance shareholder value in a competitive landscape.
See More
Lithia & Driveway Q1 Earnings Exceed Expectations
- Earnings Beat: Lithia & Driveway reported a Q1 non-GAAP EPS of $7.34, surpassing expectations by $0.48, which underscores the company's robust profitability and enhances investor confidence.
- Revenue Growth: The company achieved Q1 revenue of $9.3 billion, reflecting a 1.1% year-over-year increase and exceeding market expectations by $80 million, indicating its ability to maintain stable revenue growth in a competitive market.
- Used Vehicle Revenue Surge: Used vehicle revenue increased by 4.6% on a same-store basis, while retail gross profit per unit (GPU) rose by 9%, or $133 sequentially, demonstrating strong performance and effective cost management in the used car market.
- Record Financing Achievements: Driveway Finance Corporation reached record originations of $840 million with an 18.0% penetration rate and an average FICO score of 750, showcasing the company's strong competitiveness and market acceptance in the financial services sector.
See More
Lithia & Driveway Reports Strong Q1 Results with $9.3 Billion Revenue
- Revenue Growth: Lithia & Driveway reported first-quarter revenues of $9.3 billion, reflecting a 1% increase from the previous year, indicating the company's stable performance in the automotive retail market despite economic challenges.
- Used Vehicle Sales Surge: Used vehicle revenue increased by 4.6% year-over-year, showcasing strong same-store sales performance and further solidifying the company's market position.
- Profitability Decline: The first quarter diluted earnings per share were $4.28, a 46% decrease year-over-year primarily due to investment losses, although the adjusted EPS of $7.34 demonstrates the resilience of core operations.
- Share Buybacks and Dividends: The company repurchased approximately $259 million in shares, representing 4% of outstanding shares, and declared a dividend of $0.57 per share, reflecting a commitment to shareholder returns.
See More
Lithia Motors Expected to Announce Dividend Increase
- Dividend Growth Expectation: Lithia Motors is expected to announce a dividend increase this April, continuing its 15-year streak of consistent growth, with analysts projecting an annual dividend of approximately $2.26 per share, translating to a quarterly dividend of about $0.565, reflecting a 2.7% increase from the current $0.55 payout.
- Historical Performance Analysis: Over the past five years, the company has achieved a dividend growth rate of around 12.33%, maintaining a payout ratio of 6.44%, which indicates its stability and sustainability in dividend payments.
- Safety Ratings: According to dividend metrics ratings, Lithia Motors holds an A+ for safety, a C+ for growth, a D+ for yield, and a B+ for consistency, suggesting a strong assurance in its dividend payment safety.
- Investor Focus: Investors should closely monitor the upcoming Q1 2026 results set to be released on April 29, 2026, which will provide crucial insights into the company's future dividend policies and financial health.
See More
US Navy Seizes Iranian Cargo Ship, Sparking Market Concerns
- Navy Seizure Incident: President Trump announced the U.S. Navy seized an Iranian cargo ship, leading to a cautious market sentiment as investor concerns about Middle Eastern tensions rise, causing oil prices to increase and potentially impacting consumer spending.
- Oil Price Warning: The Energy Secretary warned that gas prices could remain above $3 per gallon until next year, which would negatively affect consumers already feeling the pinch of high costs, further impacting economic recovery.
- Tech and Finance Intersection: Kevin Warsh, Trump's nominee for Federal Reserve Chair, is set for a Senate confirmation hearing, and his close ties to Silicon Valley could change the interaction between tech giants and the Fed, influencing future monetary policy.
- Automotive Dealer Consolidation Trend: Data shows that the top 150 auto dealers in the U.S. increased their market share from 21.2% a decade ago to 27%, reflecting the rise of mega-dealers and the struggles of smaller competitors, potentially leading to significant industry structural changes.
See More
US Navy Seizes Iranian Cargo Ship, Market Sentiment Shifts
- Navy Seizure Incident: President Trump announced that the U.S. Navy seized an Iranian cargo ship in the Gulf of Oman, shifting market sentiment to a defensive stance as investor concerns about Middle Eastern tensions rise, leading to higher oil prices and downward pressure on stock futures.
- Oil Price Warning: Amid fears of escalating tensions in the Middle East, oil prices are rising, with the Energy Secretary warning that gas prices could remain above $3 per gallon until next year, further straining consumers already facing higher costs.
- Tech Ties and Fed: Kevin Warsh, Trump's nominee for the Federal Reserve chair, will face confirmation hearings tomorrow, with his close ties to Silicon Valley raising questions about potential access for tech moguls to the Fed, a point of significant market interest.
- Dealer Consolidation: Data shows that the top 150 car dealerships in the U.S. increased their market share from 21.2% a decade ago to 27%, reflecting a trend of consolidation that benefits larger dealers like Lithia Motors and AutoNation.
See More
