Lithia Motors (NYSE:LAD) Stock Price Target Lowered at JPMorgan Chase & Co.

Key Points

• JPMorgan lowered Lithia Motors’ price target from $320 to $315 while maintaining a neutral rating, implying roughly 9.9% upside from the prior close.
• Lithia reported a quarterly earnings beat, with EPS of $10.34 versus the $9.70 consensus and revenue of $9.95 billion versus $9.75 billion expected; revenue rose 2.8% year over year.
• Analyst sentiment remains generally positive, with a “Moderate Buy” consensus and average price target of $402.10, though the stock trades below its moving averages and carries notable leverage and liquidity concerns.

Lithia Motors (NYSE:LAD - Get Free Report) had its price objective dropped by JPMorgan Chase & Co. from $320.00 to $315.00 in a research note issued on Thursday, Benzinga reports. The brokerage currently has a "neutral" rating on the stock. JPMorgan Chase & Co.'s price target suggests a potential upside of 9.91% from the stock's previous close.

LAD has been the subject of several other reports. Morgan Stanley cut their target price on shares of Lithia Motors from $358.00 to $310.00 and set an "equal weight" rating for the company in a research note on Monday, October 5th. Weiss Ratings lowered shares of Lithia Motors from a "buy (b-)" rating to a "hold (c+)" rating in a research report on Wednesday, October 14th. Wall Street Zen upgraded shares of Lithia Motors from a "sell" rating to a "hold" rating in a report on Saturday, August 1st. UBS Group cut their price objective on shares of Lithia Motors from $440.00 to $335.00 and set a "neutral" rating for the company in a research report on Wednesday, October 7th. Finally, Wells Fargo & Company increased their target price on shares of Lithia Motors from $306.00 to $395.00 and gave the company an "equal weight" rating in a research note on Thursday, July 30th. Six analysts have rated the stock with a Buy rating and six have issued a Hold rating to the company. Based on data from MarketBeat.com, Lithia Motors currently has an average rating of "Moderate Buy" and an average price target of $402.10.

Lithia Motors Stock Performance

NYSE LAD traded up $17.46 during trading on Thursday, hitting $286.59. The company's stock had a trading volume of 89,810 shares, compared to its average volume of 313,477. The company has a quick ratio of 0.21, a current ratio of 1.00 and a debt-to-equity ratio of 1.46. The firm has a 50 day moving average price of $333.62 and a 200 day moving average price of $315.12. The firm has a market cap of $6.30 billion, a P/E ratio of 9.49, a price-to-earnings-growth ratio of 0.69 and a beta of 1.27. Lithia Motors has a 52 week low of $239.78 and a 52 week high of $439.49.

Lithia Motors (NYSE:LAD - Get Free Report) last issued its quarterly earnings results on Wednesday, October 21st. The company reported $10.34 EPS for the quarter, topping analysts' consensus estimates of $9.70 by $0.64. Lithia Motors had a return on equity of 12.16% and a net margin of 1.88%. The company had revenue of $9.95 billion during the quarter, compared to analyst estimates of $9.75 billion. During the same period in the previous year, the company earned $9.50 earnings per share. The company's quarterly revenue was up 2.8% compared to the same quarter last year. Equities research analysts forecast that Lithia Motors will post 35.60 earnings per share for the current fiscal year.

Insiders Place Their Bets

In other Lithia Motors news, Director Stacy Congdon sold 75 shares of the business's stock in a transaction on Friday, September 11th. The shares were sold at an average price of $370.73, for a total value of $27,804.75. Following the sale, the director owned 2,300 shares of the company's stock, valued at $852,679. The trade was a 3.16% decrease in their position. The sale was disclosed in a filing with the SEC, which can be accessed through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. 1.08% of the stock is owned by corporate insiders.

Hedge Funds Weigh In On Lithia Motors

A number of hedge funds have recently made changes to their positions in LAD. BlackRock Inc. acquired a new stake in shares of Lithia Motors during the 2nd quarter valued at about $696,482,000. Madison Asset Management LLC acquired a new position in Lithia Motors in the second quarter worth about $66,988,000. Bank of New York Mellon Corp acquired a new position in Lithia Motors in the second quarter worth about $63,015,000. The Manufacturers Life Insurance Company bought a new position in Lithia Motors during the second quarter worth about $42,718,000. Finally, Bank of America Corp DE bought a new position in Lithia Motors during the second quarter worth about $21,371,000.

Trending Headlines about Lithia Motors

Here are the key news stories impacting Lithia Motors this week:

• Positive Sentiment: Q3 earnings and revenue exceeded expectations. Adjusted earnings were $10.34 per share versus the $9.70 consensus estimate, while revenue reached approximately $9.95 billion compared with expectations of $9.75 billion. Revenue increased 2.8% year over year, and adjusted EPS rose 9%. Lithia Motors Tops Q3 Earnings and Revenue Estimates
• Positive Sentiment: Core operating metrics improved. Used retail gross profit per unit increased 11% year over year, aftersales gross margin rose to 59.5% on a same-store basis, and Driveway Finance income jumped 69% to $32.3 million. Record finance originations of $937 million also indicate solid demand for the company’s financing operations. Lithia Three Key Takeaways
• Positive Sentiment: Capital returns increased. Lithia repurchased $85 million of stock during the quarter and announced a 7.1% dividend increase, raising the quarterly payout to $0.75 per share, or $3.00 annualized. Lithia Third Quarter Results
• Neutral Sentiment: Management’s earnings call provides additional detail on sales trends, financing, margins, and the company’s outlook for investors. Lithia Motors Q3 Earnings Call Transcript
• Negative Sentiment: Technical and balance-sheet concerns remain. LAD trades below its 50-day and 200-day moving averages, while its debt-to-equity ratio is 1.46 and quick ratio is 0.21. These factors may limit the market’s reaction to the earnings beat despite the improved results.

Lithia Motors Company Profile

Lithia Motors, Inc is an automotive retailer headquartered in Medford, Oregon. Operating under the Lithia & Driveway name, the company sells new and used vehicles through a network of franchised dealerships and digital retail channels. Its dealerships represent a broad range of domestic, Asian and European automotive brands.

In addition to vehicle sales, Lithia provides related services including vehicle financing and insurance products, parts and maintenance, collision repair, and other after-sales support.

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