Redwood Investment Management LLC Buys New Position in Lithia Motors, Inc. $LAD

Key Points

• Redwood Investment Management initiated a Lithia Motors position of 4,098 shares valued at approximately $1.19 million during the second quarter. Other major institutions, including BlackRock and Norges Bank, also established or expanded holdings.
• Lithia Motors reported quarterly EPS of $10.03, beating estimates by $1.30, while revenue rose 2.2% year over year to $9.79 billion. The company also authorized a $500 million share-repurchase program and raised its quarterly dividend to $0.70 per share.
• Analysts maintain a generally positive view, with six Buy ratings and five Holds, producing a “Moderate Buy” consensus and an average price target of $436.33 versus the stock’s reported $369.74 opening price.

Redwood Investment Management LLC bought a new stake in Lithia Motors, Inc. (NYSE:LAD - Free Report) during the 2nd quarter, according to the company in its most recent 13F filing with the Securities and Exchange Commission. The fund bought 4,098 shares of the company's stock, valued at approximately $1,190,000.

Several other hedge funds also recently made changes to their positions in the business. BlackRock Inc. acquired a new position in Lithia Motors during the second quarter worth $696,482,000. Norges Bank acquired a new stake in Lithia Motors in the 4th quarter valued at $125,214,000. Madison Asset Management LLC acquired a new stake in Lithia Motors in the 2nd quarter valued at $66,988,000. Bank of New York Mellon Corp bought a new stake in Lithia Motors during the 2nd quarter worth about $63,015,000. Finally, River Road Asset Management LLC boosted its stake in shares of Lithia Motors by 33.6% during the 4th quarter. River Road Asset Management LLC now owns 742,677 shares of the company's stock worth $246,814,000 after buying an additional 186,628 shares during the last quarter.

Insider Transactions at Lithia Motors

In other Lithia Motors news, Director Shauna Mcintyre sold 165 shares of the company's stock in a transaction on Wednesday, June 10th. The stock was sold at an average price of $305.64, for a total value of $50,430.60. Following the transaction, the director directly owned 1,681 shares of the company's stock, valued at $513,780.84. This represents a 8.94% decrease in their position. The sale was disclosed in a filing with the SEC, which is available through this hyperlink. 1.08% of the stock is owned by company insiders.

Lithia Motors Trading Down 0.6%

LAD stock opened at $369.74 on Thursday. Lithia Motors, Inc. has a one year low of $239.78 and a one year high of $439.49. The stock has a market cap of $8.13 billion, a price-to-earnings ratio of 12.26, a price-to-earnings-growth ratio of 0.78 and a beta of 1.22. The company has a fifty day moving average price of $341.26 and a two-hundred day moving average price of $301.18. The company has a debt-to-equity ratio of 1.46, a current ratio of 1.00 and a quick ratio of 0.21.

Lithia Motors (NYSE:LAD - Get Free Report) last posted its earnings results on Wednesday, July 29th. The company reported $10.03 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $8.73 by $1.30. Lithia Motors had a net margin of 1.88% and a return on equity of 12.16%. The company had revenue of $9.79 billion during the quarter, compared to analysts' expectations of $9.64 billion. During the same quarter last year, the company posted $10.24 EPS. Lithia Motors's quarterly revenue was up 2.2% compared to the same quarter last year. Equities analysts anticipate that Lithia Motors, Inc. will post 36 EPS for the current year.

Lithia Motors announced that its Board of Directors has authorized a stock repurchase program on Tuesday, May 26th that allows the company to repurchase $500.00 million in shares. This repurchase authorization allows the company to buy up to 7.9% of its stock through open market purchases. Stock repurchase programs are often a sign that the company's leadership believes its shares are undervalued.

Lithia Motors Increases Dividend

The company also recently declared a quarterly dividend, which was paid on Friday, August 21st. Investors of record on Friday, August 7th were issued a dividend of $0.70 per share. This represents a $2.80 annualized dividend and a yield of 0.8%. The ex-dividend date of this dividend was Friday, August 7th. This is an increase from Lithia Motors's previous quarterly dividend of $0.57. Lithia Motors's payout ratio is 9.29%.

Analyst Ratings Changes

Several research analysts recently commented on LAD shares. Weiss Ratings raised Lithia Motors from a "hold (c)" rating to a "hold (c+)" rating in a research report on Tuesday, August 4th. Citigroup boosted their target price on shares of Lithia Motors from $365.00 to $455.00 and gave the stock a "buy" rating in a report on Monday, August 3rd. Benchmark increased their price target on shares of Lithia Motors from $400.00 to $475.00 and gave the company a "buy" rating in a research note on Thursday, July 30th. Bank of America boosted their price objective on shares of Lithia Motors from $350.00 to $417.00 and gave the stock a "buy" rating in a research note on Thursday, July 9th. Finally, Wall Street Zen upgraded shares of Lithia Motors from a "sell" rating to a "hold" rating in a research note on Saturday, August 1st. Six analysts have rated the stock with a Buy rating and five have given a Hold rating to the company's stock. According to MarketBeat.com, Lithia Motors currently has an average rating of "Moderate Buy" and an average target price of $436.33.

Lithia Motors Profile

Lithia Motors, Inc is an American automotive retailer headquartered in Medford, Oregon. Founded in 1946 as a small auto body and glass shop, the company has grown through organic expansion and strategic acquisitions to become one of the largest automotive retail networks in North America. Lithia operates dealerships across the United States and Canada, offering a broad portfolio of new and pre-owned vehicles from more than 40 different manufacturers.

The company's core business activities include vehicle sales, financing, insurance, parts and service.

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