Category: LAD

LAD – Why Is Lithia Motors (LAD) Down 11.1% Since Last Earnings Report?

A month has gone by since the last earnings report for Lithia Motors (LAD Free Report) . Shares have lost about 11.1% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Lithia Motors due for a breakout? Before we dive into how investors and analysts have reacted as of late, let’s take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.

Lithia Motors Puts Up a Stellar Show in Q2

Lithia Motors reported second-quarter 2021 adjusted earnings of $11.12 per share, handily beating the Zacks Consensus Estimate of $6.56. Higher-than-expected revenues across all units led to the outperformance. The bottom line increased a whopping 199% from the prior-year quarter’s $3.72 per share. Total revenues also jumped 117.8% year over year to $6,009.4 million. Moreover, the top line surpassed the Zacks Consensus Estimate of $5,006 million. In fact, for the reported quarter, Lithia Motors claims to have reported the highest quarterly earnings and revenues in its history. Thanks to strong results, shares of the company rose 4.38% yesterday to close the session at $371.13.

Segmental Performance

New vehicle retail revenues increased 130% year over year to $3,146.2 million and topped the Zacks Consensus Estimate of $2,464 million. New vehicle units sold climbed 115.6% from the prior-year quarter to 75,176. The average selling price of new-vehicle retail rose 6.7% from the prior-year quarter to $41,852.

Used-vehicle retail revenues rose 95.7% year over year to $1,804.9 million and beat the Zacks Consensus Estimate of $1,525 million. Used-vehicle retail units sold grew 61.5% from the year-ago quarter to 70,254. The average selling price of used-vehicle retail improved 21.2% to $25,691 from the year-ago figure of $21,196. Revenues from used-vehicle wholesale skyrocketed 323.8% year over year to $217.4 million and surpassed the consensus mark of $88 million.

Revenues from service, body and parts were up 89.1% from the prior-year period to $521 million, and outpaced the Zacks Consensus Estimate of $410 million. The company’s F&I (Finance & Insurance) business recorded 115.9% year-over-year growth in revenues to $296.6 million, topping the consensus estimate of $228 million. Revenues from fleet and others were $50.3 million, jumping 197.6% year over year and surpassing the consensus mark of $28.05 million.

While same-store new vehicle sales rose 55.2% year over year, same-store used vehicle retail sales increased 48.8%. While same-store revenues from the F&I business soared 50%, that of the service, body and parts unit grew 30.5% from the prior-year quarter.

Financial Tidbits

Cost of sales jumped 113.5% year over year for second-quarter 2021. However, SG&A — as a percentage of gross profit — decreased from the prior-year level. Encouragingly, pretax and net profit margins improved from the year-ago levels.

Quarterly dividend of 35 cents a share will be payable on Aug 27 to shareholders of record as of Aug 13, 2021.

Lithia had cash and cash equivalents of $780.9 million as of Jun 30, 2021. Long-term debt was $2,521.9 million, marking an increase from $2,064.7 million as of Dec 31, 2020.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed an upward trend in estimates review. The consensus estimate has shifted 50.34% due to these changes.

VGM Scores

At this time, Lithia Motors has a great Growth Score of A, a grade with the same score on the momentum front. Following the exact same course, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of A. If you aren’t focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Lithia Motors has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.

LAD – Lithia Motors & Driveway (LAD) Announces Pricing Of Public Offering Of Common Stock

MEDFORD, Ore., May 19, 2021 /PRNewswire/ — Lithia Motors & Driveway (NYSE: LAD) today announced the pricing of its public offering (the “Offering”) of 3,105,590 shares of its Class A common stock (the “common stock”) at a price to the public of $322.00 per share. In addition, the underwriters have been granted a 30-day option to purchase up to an additional 465,838 shares of common stock at the same public offering price, less underwriting discounts and commissions. The offering is expected to close on May 24, 2021, subject to the satisfaction of customary closing conditions.

In addition, today Lithia concurrently announced the pricing of its private offering of $800 million aggregate principal amount of its 3.875% senior notes due 2029 (the “Notes”), which represents an increase of $300 million from the offering size previously announced. This press release is neither an offer to sell nor a solicitation of an offer to buy the Notes.

J.P. Morgan and Goldman Sachs & Co. LLC are acting as joint book-running managers for the Offering. BofA Securities, BTIG, Craig-Hallum, Guggenheim Securities, Jefferies, Stephens Inc. and Wells Fargo Securities are acting as bookrunners, and The Benchmark Company, Citigroup and Seaport Global Securities are acting as co-managers in the Offering.

A shelf registration statement relating to our common stock has been filed with the Securities and Exchange Commission (the “SEC”) and became automatically effective upon filing. The Offering is being made only by means of a prospectus supplement and an accompanying prospectus. A preliminary prospectus supplement relating to and describing the terms of the Offering was filed with the SEC on May 18, 2021 and is available on the SEC’s website at www.sec.gov. Copies of these documents and the final prospectus supplement, when available, may be obtained from: J.P. Morgan Securities LLC, Attention: Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717, telephone: 1-866-803-9204, or by email at [email protected]; or Goldman Sachs & Co. LLC, 200 West Street, New York, New York 10282, Attention: Prospectus Department, by telephone at (866) 471-2526, or by email at [email protected].

This press release is neither an offer to sell nor a solicitation of an offer to buy shares of our common stock or any other securities and shall not constitute an offer to sell or a solicitation of an offer to buy, or a sale of, shares of our common stock or any other securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.

About Lithia
Lithia Motors & Driveway is a growth company powered by people and innovation with a 5-year plan to profitably consolidate the largest retail sector in the country. They are a leading provider of personal transportation solutions in the United States and are among the fastest-growing companies in the Fortune 500 (#6 on 10-Year EPS Growth, #4 10-Year TSR in 2020). By providing a wide array of products throughout the entire lifecycle of the consumer’s vehicle ownership experience through various consumer channels, they build magnetic brand loyalty. Operational excellence is achieved by focusing the business on convenient and transparent consumer experiences supported by proprietary data science to increase market share, consumer loyalty and team performance. Lithia’s omni-channel strategy will continue to pragmatically disrupt the industry by leveraging experienced teams, vast owned inventories, technology, and physical network. By purchasing strong businesses, they further strengthen this network, leveraging their national digital home channel Driveway and building upon their massive regenerating capital engine. Together, these endeavors create a unique and compelling high-growth strategy that provides transportation solutions wherever, whenever, and however consumers desire.

Forward-Looking Statements
Certain statements in this press release, and at times made by our officers and representatives, constitute forward-looking statements within the meaning of the “Safe Harbor” provisions of the Private Securities Litigation Reform Act of 1995. Generally, you can identify forward-looking statements by terms such as “project”, “outlook”, “target”, “may”, “will”, “would”, “should”, “seek”, “expect”, “plan”, “intend”, “forecast”, “anticipate”, “believe”, “estimate”, “predict”, “potential”, “likely”, “goal”, “strategy”, “future”, “maintain”, and “continue” or the negative of these terms or other comparable terms. Examples of forward-looking statements in this press release include, among others, statements regarding the Offering and our concurrent private offering of the Notes.

Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Forward-looking statements are not guarantees of future performance, and our actual results of operations, financial condition and liquidity and development of the industry in which we operate may differ materially from those made in or suggested by the forward-looking statements in this press release. Therefore, you should not rely on any of these forward-looking statements. The risks and uncertainties that could cause actual results to differ materially from estimated or projected results include, without limitation:

  • Future economic and financial conditions (both nationally and locally), including as a result of the COVID-19 pandemic;
  • Changes in customer demand, our relationship with, and the financial and operational stability of, vehicle manufacturers and other suppliers;
  • Risks associated with our indebtedness (including available borrowing capacity, compliance with financial covenants and ability to refinance or repay indebtedness on favorable terms);
  • The adequacy of our cash flow and earnings and other conditions which may affect our ability to pay our quarterly dividend at the planned level;
  • Disruptions to our technology network including computer systems and software, as well as natural events such as severe weather, fires, floods and earthquakes or man-made or other disruptions of our operating systems, structures, facilities or equipment; and
  • Government regulations and legislation, and other risks set forth throughout “Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” and in “Part I, Item 1A. Risk Factors” of our most recent Annual Report on Form 10-K, and from time to time in our other filings with the SEC.

Any forward-looking statement made by us in this press release is based only on information currently available to us and speaks only as of the date on which it is made. We undertake no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.

SOURCE Lithia Motors, Inc.

Related Links

www.lithia.com

LAD – Lithia Motors & Driveway (LAD) Announces Upsizing And Pricing Of Senior Notes Offering

MEDFORD, Ore., May 19, 2021 /PRNewswire/ — Lithia Motors & Driveway (NYSE: LAD) today announced the pricing of $800 million in aggregate principal amount of its 3.875% senior notes due 2029 (the “Notes”) in a private offering (the “Private Offering”), which represents an increase of $300 million from the offering size previously announced. The Private Offering is expected to close on May 27, 2021, subject to customary closing conditions.

Lithia intends to use a portion of the net proceeds of the Private Offering to redeem or repurchase all of its outstanding $300 million aggregate principal amount of 5.250% senior notes due 2025 (the “2025 Notes”), and to pay fees and expenses in connection therewith, and to use the remainder for general corporate purposes, which may include financing possible acquisitions, repaying or refinancing debt, working capital and capital expenditures.

In addition, today Lithia concurrently announced that it has priced its previously announced registered public offering of 3,105,590 shares of its Class A common stock (the “common stock”) (3,571,428 shares if the underwriters in the common stock offering exercise in full their option to purchase additional shares) at a public offering price of $322.00 per share. This press release is neither an offer to sell nor a solicitation of an offer to buy shares of our common stock.

The Private Offering is exempt from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”). The Notes will be offered and sold only to persons reasonably believed to be qualified institutional buyers in the United States pursuant to Rule 144A under the Securities Act and outside the United States pursuant to Regulation S under the Securities Act. The Notes have not been, and will not be, registered under the Securities Act, or any state securities laws, and may not be offered or sold in the United States absent registration or an applicable exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and the rules promulgated thereunder.

This press release is being issued pursuant to Rule 135c under the Securities Act, and is neither an offer to sell nor a solicitation of an offer to buy the Notes or any other securities and shall not constitute an offer to sell or a solicitation of an offer to buy, or a sale of, the Notes or any other securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. In addition, this press release is not and should not be construed as a notice of redemption for the 2025 Notes, or an offer to tender for, or purchase, any of the 2025 Notes or any other securities.

About Lithia

Lithia Motors & Driveway is a growth company powered by people and innovation with a 5-year plan to profitably consolidate the largest retail sector in the country. They are a leading provider of personal transportation solutions in the United States and are among the fastest-growing companies in the Fortune 500 (#6 on 10-Year EPS Growth, #4 10-Year TSR in 2020). By providing a wide array of products throughout the entire lifecycle of the consumer’s vehicle ownership experience through various consumer channels, they build magnetic brand loyalty. Operational excellence is achieved by focusing the business on convenient and transparent consumer experiences supported by proprietary data science to increase market share, consumer loyalty and team performance. Lithia’s omni-channel strategy will continue to pragmatically disrupt the industry by leveraging experienced teams, vast owned inventories, technology, and physical network. By purchasing strong businesses, they further strengthen this network, leveraging their national digital home channel Driveway and building upon their massive regenerating capital engine. Together, these endeavors create a unique and compelling high-growth strategy that provides transportation solutions wherever, whenever, and however consumers desire.

Forward-Looking Statements

Certain statements in this press release, and at times made by our officers and representatives, constitute forward-looking statements within the meaning of the “Safe Harbor” provisions of the Private Securities Litigation Reform Act of 1995. Generally, you can identify forward-looking statements by terms such as “project”, “outlook”, “target”, “may”, “will”, “would”, “should”, “seek”, “expect”, “plan”, “intend”, “forecast”, “anticipate”, “believe”, “estimate”, “predict”, “potential”, “likely”, “goal”, “strategy”, “future”, “maintain”, and “continue” or the negative of these terms or other comparable terms. Examples of forward-looking statements in this press release include, among others, statements regarding the Private Offering, our concurrent public offering of common stock and the expected redemption or repurchase of the 2025 Notes.

Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Forward-looking statements are not guarantees of future performance, and our actual results of operations, financial condition and liquidity and development of the industry in which we operate may differ materially from those made in or suggested by the forward-looking statements in this press release. Therefore, you should not rely on any of these forward-looking statements. The risks and uncertainties that could cause actual results to differ materially from estimated or projected results include, without limitation:

  • Future economic and financial conditions (both nationally and locally), including as a result of the COVID-19 pandemic;
  • Changes in customer demand, our relationship with, and the financial and operational stability of, vehicle manufacturers and other suppliers;
  • Risks associated with our indebtedness (including available borrowing capacity, compliance with financial covenants and ability to refinance or repay indebtedness on favorable terms);
  • The adequacy of our cash flow and earnings and other conditions which may affect our ability to pay our quarterly dividend at the planned level;
  • Disruptions to our technology network including computer systems and software, as well as natural events such as severe weather, fires, floods and earthquakes or man-made or other disruptions of our operating systems, structures, facilities or equipment; and
  • Government regulations and legislation, and other risks set forth throughout “Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” and in “Part I, Item 1A. Risk Factors” of our most recent Annual Report on Form 10-K, and from time to time in our other filings with the SEC.

Any forward-looking statement made by us in this press release is based only on information currently available to us and speaks only as of the date on which it is made. We undertake no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.

SOURCE Lithia Motors, Inc.

Related Links

www.lithia.com

LAD – Lithia Motors & Driveway (LAD) Announces Proposed Public Offering Of Common Stock

MEDFORD, Ore., May 18, 2021 /PRNewswire/ — Lithia Motors & Driveway (NYSE: LAD) today announced that we intend to offer, subject to market and other conditions, $1 billion of shares of our Class A common stock (the “common stock”) in a public offering (the “Offering”). In addition, we intend to grant the underwriters a 30-day option to purchase up to an additional $150 million of shares of common stock. Lithia intends to use the net proceeds of the Offering for general corporate purposes, which may include financing possible acquisitions, repaying or refinancing debt, working capital and capital expenditures.

In addition, today we concurrently announced our intention to offer $500 million aggregate principal amount of senior notes due 2029 (the “Notes”) in a private offering. This press release is neither an offer to sell nor a solicitation of an offer to buy the Notes.

J.P. Morgan and Goldman Sachs & Co. LLC are acting as joint book-running managers for the Offering. BofA Securities, BTIG, Craig-Hallum, Guggenheim Securities, Jefferies, Stephens Inc. and Wells Fargo Securities are acting as bookrunners, and The Benchmark Company, Citigroup and Seaport Global Securities are acting as co-managers in the Offering.

A shelf registration statement relating to our common stock has been filed with the Securities and Exchange Commission (the “SEC”) and became automatically effective upon filing. The Offering will be made only by means of a prospectus supplement and an accompanying prospectus. A preliminary prospectus supplement relating to and describing the terms of the Offering will be filed with the SEC and will be available on the SEC’s website at www.sec.gov. When available, copies of the preliminary prospectus supplement and the accompanying prospectus may also be obtained from: J.P. Morgan Securities LLC, Attention: Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717, telephone: 1-866-803-9204, or by email at [email protected]; or Goldman Sachs & Co. LLC, 200 West Street, New York, New York 10282, Attention: Prospectus Department, by telephone at (866) 471-2526, or by email at [email protected].

This press release is neither an offer to sell nor a solicitation of an offer to buy shares of our common stock or any other securities and shall not constitute an offer to sell or a solicitation of an offer to buy, or a sale of, shares of our common stock or any other securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.

About Lithia

Lithia Motors & Driveway is a growth company powered by people and innovation with a 5-year plan to profitably consolidate the largest retail sector in the country. They are a leading provider of personal transportation solutions in the United States and are among the fastest-growing companies in the Fortune 500 (#6 on 10-Year EPS Growth, #4 10-Year TSR in 2020). By providing a wide array of products throughout the entire lifecycle of the consumer’s vehicle ownership experience through various consumer channels, they build magnetic brand loyalty. Operational excellence is achieved by focusing the business on convenient and transparent consumer experiences supported by proprietary data science to increase market share, consumer loyalty and team performance. Lithia’s omni-channel strategy will continue to pragmatically disrupt the industry by leveraging experienced teams, vast owned inventories, technology, and physical network. By purchasing strong businesses, they further strengthen this network, leveraging their national digital home channel Driveway and building upon their massive regenerating capital engine. Together, these endeavors create a unique and compelling high-growth strategy that provides transportation solutions wherever, whenever, and however consumers desire.

Forward-Looking Statements

Certain statements in this press release, and at times made by our officers and representatives, constitute forward-looking statements within the meaning of the “Safe Harbor” provisions of the Private Securities Litigation Reform Act of 1995. Generally, you can identify forward-looking statements by terms such as “project”, “outlook”, “target”, “may”, “will”, “would”, “should”, “seek”, “expect”, “plan”, “intend”, “forecast”, “anticipate”, “believe”, “estimate”, “predict”, “potential”, “likely”, “goal”, “strategy”, “future”, “maintain”, and “continue” or the negative of these terms or other comparable terms. Examples of forward-looking statements in this press release include, among others, statements regarding the Offering and our concurrent private offering of the Notes.

Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Forward-looking statements are not guarantees of future performance, and our actual results of operations, financial condition and liquidity and development of the industry in which we operate may differ materially from those made in or suggested by the forward-looking statements in this press release. Therefore, you should not rely on any of these forward-looking statements. The risks and uncertainties that could cause actual results to differ materially from estimated or projected results include, without limitation:

  • Future economic and financial conditions (both nationally and locally), including as a result of the COVID-19 pandemic;
  • Changes in customer demand, our relationship with, and the financial and operational stability of, vehicle manufacturers and other suppliers;
  • Risks associated with our indebtedness (including available borrowing capacity, compliance with financial covenants and ability to refinance or repay indebtedness on favorable terms);
  • The adequacy of our cash flow and earnings and other conditions which may affect our ability to pay our quarterly dividend at the planned level;
  • Disruptions to our technology network including computer systems and software, as well as natural events such as severe weather, fires, floods and earthquakes or man-made or other disruptions of our operating systems, structures, facilities or equipment; and
  • Government regulations and legislation, and other risks set forth throughout “Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” and in “Part I, Item 1A. Risk Factors” of our most recent Annual Report on Form 10-K, and from time to time in our other filings with the SEC.

Any forward-looking statement made by us in this press release is based only on information currently available to us and speaks only as of the date on which it is made. We undertake no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.

SOURCE Lithia Motors, Inc.

Related Links

www.lithia.com

LAD – A Preview Of Lithia Motors's Earnings

On Wednesday, April 21, Lithia Motors (NYSE:LAD) will release its latest earnings report. Check out Benzinga’s preview to understand the implications.

What Are Earnings, Net Income, And Earnings Per Share?

Earnings and EPS are useful metrics of profitability. Total earnings also known as net income is equal to total revenue minus total expenses. Dividing net income by the total number of shares outstanding yields EPS.

Earnings And Revenue

Based on Lithia Motors management projections, analysts predict EPS of $4.74 on revenue of $3.88 billion. Lithia Motors earnings in the same period a year ago was $2.01 per share. Quarterly sales came in at $2.80 billion.

Why Analyst Estimates And Earnings Surprises Are Important

Wall Street analysts who study this company will publish analyst estimates of revenue and EPS. The averages of all analyst EPS and revenue estimates are called the “consensus estimates”; these consensus estimates can have a significant effect on a company’s performance during an earnings release. When a company posts earnings or revenue above or below a consensus estimate, it has posted an “earnings surprise”, which can really move a stock depending on the difference between actual and estimated values.

The analyst consensus estimate would represent a 135.82% increase in the company’s earnings. Sales would be have grown 38.37% from the same quarter last year. Lithia Motors’s reported EPS has stacked up against analyst estimates in the past like this:

Quarter Q4 2021 Q3 2020 Q2 2020 Q1 2020
EPS Estimate 5.06 5.86 1.54 2.05
EPS Actual 5.46 6.89 3.72 2.01
Revenue Estimate 3.93 B 3.57 B 2.42 B 2.93 B
Revenue Actual 3.94 B 3.62 B 2.76 B 2.80 B

eps graph

Stock Performance

Shares of Lithia Motors were trading at $387.52 as of April 19. Over the last 52-week period, shares are up 305.83%. Given that these returns are generally positive, long-term shareholders should be satisfied going into this earnings release.

Do not be surprised to see the stock move on comments made during its conference call. Lithia Motors is scheduled to hold the call at 10:00:00 ET and can be accessed here.

LAD – Lithia (LAD) Expands Footprint With Fink Automotive Buyout

Lithia Motors, Inc. (LAD Free Report) recently announced the acquisition of the Fink Automotive Group. The group is located in Tampa, FL, and is led by company president Scott Fink.

Lithia’s latest buyout includes five locations and seven franchises (Hyundai of New Port Richey, Genesis of New Port Richey, Volkswagen of New Port Richey, Hyundai of Wesley Chapel, Genesis of Wesley Chapel, Mazda of Wesley Chapel, and Chevrolet of Wesley Chapel). Hyundai of New Port Richey has been the largest volume Hyundai dealership in the United States for eight straight years.

The transaction has further strengthened Lithia’s footprint in the Southeast and is anticipated to add $430 million in annualized revenues. It will also increase the auto retailer’s Southeast region revenues to more than $1 billion. Lithia financed the buyout through capital raised in concurrent equity and debt offerings in late 2020.

Lithia had earlier announced a five-year plan to yield $50 billion in revenues and $50 in earnings per share. Since the plan’s roll-out, the retailer has achieved $4 billion in total expected annualized revenues acquired.

Lithia is one of the leading automotive retailers of new and used vehicles, and related services in the United States. It offers tailored services complemented through its nationwide network. The buyout of the Fink Automotive Group is in sync with the auto retailer’s proven success strategy of acquiring strong, high-performing franchises.

Lithia is highly optimistic about the buyout. Tampa is one of the hottest markets, as validated by the success of the Hyundai store in New Port Richey. These franchises would perfectly supplement Lithia’s existing product portfolio. In fact, the buyout aligns with Lithia’s plan to fortify the reach and density of its network to serve customers more conveniently. In addition, Fink Automotive’s unparalleled commitment to providing the highest level of customer service will further enhance Lithia’s offerings.

Lithia currently carries a Zacks Rank #3 (Hold). The company put up a stellar show in the fourth quarter of 2020, delivering earnings of $5.46 per share, up a whopping 85% from the year-ago level. Shares of the company have gain 27.9%, year to date, compared with the industry’s rally of 17.8% during the same period.

Key Picks

Some better-ranked stocks in the auto space include Rush Enterprises (RUSHA Free Report) , AutoNation Inc. (AN Free Report) and Penske Automotive Group (PAG Free Report) . While Rush currently sports a Zacks Rank of 1 (Strong Buy), AutoNation and Penske carry a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

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LAD – Lithia Motors (LAD) Stock Sinks As Market Gains: What You Should Know

In the latest trading session, Lithia Motors (LAD Free Report) closed at $292.67, marking a -0.18% move from the previous day. This change lagged the S&P 500’s 0.64% gain on the day. Elsewhere, the Dow gained 0.65%, while the tech-heavy Nasdaq added 0.14%.

Coming into today, shares of the auto dealership chain had gained 0.99% in the past month. In that same time, the Retail-Wholesale sector gained 1.3%, while the S&P 500 gained 3.19%.

LAD will be looking to display strength as it nears its next earnings release. On that day, LAD is projected to report earnings of $5.34 per share, which would represent year-over-year growth of 81.02%. Our most recent consensus estimate is calling for quarterly revenue of $3.94 billion, up 20.51% from the year-ago period.

LAD’s full-year Zacks Consensus Estimates are calling for earnings of $18.03 per share and revenue of $13.28 billion. These results would represent year-over-year changes of +53.32% and +4.78%, respectively.

Investors should also note any recent changes to analyst estimates for LAD. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company’s business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 1.88% higher. LAD currently has a Zacks Rank of #3 (Hold).

Looking at its valuation, LAD is holding a Forward P/E ratio of 16.26. This valuation marks a premium compared to its industry’s average Forward P/E of 10.4.

Meanwhile, LAD’s PEG ratio is currently 0.74. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company’s expected earnings growth rate into account. Automotive – Retail and Whole Sales stocks are, on average, holding a PEG ratio of 1.01 based on yesterday’s closing prices.

The Automotive – Retail and Whole Sales industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 9, which puts it in the top 4% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.

LAD – Lithia Motors (LAD) Gains As Market Dips: What You Should Know

Lithia Motors (LAD Free Report) closed the most recent trading day at $285.87, moving +0.53% from the previous trading session. This change outpaced the S&P 500’s 0.39% loss on the day. At the same time, the Dow added 0.12%, and the tech-heavy Nasdaq lost 0.1%.

Coming into today, shares of the auto dealership chain had gained 1.04% in the past month. In that same time, the Retail-Wholesale sector gained 3.81%, while the S&P 500 gained 4.06%.

Wall Street will be looking for positivity from LAD as it approaches its next earnings report date. The company is expected to report EPS of $5.34, up 81.02% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $3.94 billion, up 20.51% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $18.03 per share and revenue of $13.28 billion, which would represent changes of +53.32% and +4.78%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for LAD. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company’s business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate has moved 1.88% higher within the past month. LAD currently has a Zacks Rank of #3 (Hold).

In terms of valuation, LAD is currently trading at a Forward P/E ratio of 15.77. This represents a premium compared to its industry’s average Forward P/E of 11.03.

We can also see that LAD currently has a PEG ratio of 0.72. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock’s expected earnings growth rate. The Automotive – Retail and Whole Sales industry currently had an average PEG ratio of 1.06 as of yesterday’s close.

The Automotive – Retail and Whole Sales industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 6, putting it in the top 3% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.

LAD – Lithia Motors plans to expand footprint as it rolls out at-home 'Driveway' strategy

While Lithia Motors is focused on building out its online dealership strategy, the Oregon-based car retailer continues to make moves to expand its brick-and-mortar footprint.

Lithia has gobbled up a dozen car dealerships in the past two months, padding its network with locations from New York state to California.

Bryan Deboer, who has led the $6.9 billion company for more than three decades, is looking to continue growing its roster of stores.

“We made a little over a quarter billion dollars in net profit in Q3, which is a good start to be able to buy even more,” Deboer said in a conversation with CNBC’s Jim Cramer on “Mad Money” Wednesday.

Lithia expects its new locations, which include dealerships peppered across in New York, Texas, Tennessee and California, could produce more than $1.75 billion in annual revenues this year.

Lithia, which is one of the largest U.S. automotive group retailers with more than 200 locations in 18 states, sells both new and used cars. The company posted $3.6 billion in revenue in the third quarter, which saw a rebound in used car sales amid the pandemic. That number was up almost 9% from the year prior, powered by a 20% spike in used vehicle sales, according to Factset.

Same-store used vehicle sales also increased more than 11%, as consumers doled out more money on cars. Net income came in at $158.6 million, more than double that from the same period last year.

“Fortunately, a lot of people have a lot of extra money in their pockets because they’re not taking vacations and they’re not buying coffee when they go to and from work, because they’re working from home,” Deboer said.

Used car and truck prices increased by nearly 7% in September, signaling that the market has not been able to match demand for vehicles as travelers avoid public transportation and airplanes for fears of contracting coronavirus, Reuters reports. The car market has been one of the bright spots in an economy marred by a pandemic-induced slowdown.

The company is also investing heavily in its online operations with hopes of taking advantage of customers where they’re at, as individuals shift their shopping habits to the internet at an even faster-than-expected pace.

“We’re in the forefront of being able to roll out our Driveway strategy, which is an e-commerce solution,” Deboer said.

Driveway, where users can search for, purchase and sell motorized vehicles, is expected to be available in six regions by 2023. Lithia expects Driveway, which can also be used to schedule at-home car service, could bring in $9 billion in annual revenue in five years.

“You can have your car service in your slippers,” Deboer said.

Shares of Lithia barely moved in Wednesday’s session, closing up a couple pennies at $260.09. The stock is up 77% year to date.

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