Lithia Motors (NYSE:LAD) Cut to Sell at Wall Street Zen

Key Points

• Wall Street Zen downgraded Lithia Motors from hold to sell, even though other analysts remain more constructive overall.
• The stock was trading at $335.33, near its 12-month high of $360.55; it has a market cap of about $7.65 billion and a forward-looking analyst consensus of Moderate Buy with an average target price of $380.33.
• Recent fundamentals were solid: Lithia beat quarterly EPS and revenue estimates, and the board authorized a $500 million share buyback equal to about 7.9% of outstanding shares.

Lithia Motors (NYSE:LAD - Get Free Report) was downgraded by research analysts at Wall Street Zen from a "hold" rating to a "sell" rating in a research note issued to investors on Monday.

Several other equities analysts have also commented on LAD. JPMorgan Chase & Co. increased their target price on Lithia Motors from $320.00 to $325.00 and gave the company a "neutral" rating in a report on Thursday, May 7th. UBS Group lifted their price target on Lithia Motors from $348.00 to $370.00 and gave the stock a "buy" rating in a report on Friday, July 10th. Wells Fargo & Company upped their price objective on Lithia Motors from $305.00 to $306.00 and gave the stock an "equal weight" rating in a research report on Monday, July 6th. Zacks Research upgraded Lithia Motors from a "strong sell" rating to a "hold" rating in a report on Thursday, April 23rd. Finally, Citigroup raised their target price on Lithia Motors from $326.00 to $365.00 and gave the stock a "buy" rating in a research report on Friday, May 1st. Eight research analysts have rated the stock with a Buy rating and four have given a Hold rating to the company's stock. According to data from MarketBeat.com, the stock presently has an average rating of "Moderate Buy" and an average target price of $380.33.

Lithia Motors Stock Up 0.0%

Shares of NYSE LAD opened at $335.33 on Monday. The stock has a market cap of $7.65 billion, a P/E ratio of 11.77, a PEG ratio of 0.79 and a beta of 1.26. The business's fifty day simple moving average is $296.19 and its 200-day simple moving average is $293.81. Lithia Motors has a 12-month low of $239.78 and a 12-month high of $360.55. The company has a current ratio of 0.99, a quick ratio of 0.24 and a debt-to-equity ratio of 1.41.

Lithia Motors (NYSE:LAD - Get Free Report) last issued its quarterly earnings results on Wednesday, April 29th. The company reported $7.34 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $7.06 by $0.28. The company had revenue of $9.27 billion during the quarter, compared to the consensus estimate of $9.22 billion. Lithia Motors had a net margin of 1.88% and a return on equity of 12.49%. The firm's quarterly revenue was up 1.0% on a year-over-year basis. During the same quarter in the previous year, the firm earned $7.66 earnings per share. As a group, equities analysts predict that Lithia Motors will post 34.19 EPS for the current fiscal year.

Lithia Motors announced that its Board of Directors has authorized a stock buyback plan on Tuesday, May 26th that permits the company to repurchase $500.00 million in outstanding shares. This repurchase authorization permits the company to buy up to 7.9% of its shares through open market purchases. Shares repurchase plans are typically an indication that the company's leadership believes its shares are undervalued.

Insider Transactions at Lithia Motors

In other news, Director Richard J. Bailey, Jr. sold 297 shares of the business's stock in a transaction dated Tuesday, May 26th. The shares were sold at an average price of $280.57, for a total transaction of $83,329.29. Following the transaction, the director directly owned 760 shares in the company, valued at $213,233.20. The trade was a 28.10% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the SEC, which is available through this link. Also, Director Shauna Mcintyre sold 245 shares of the stock in a transaction dated Monday, May 11th. The stock was sold at an average price of $294.64, for a total transaction of $72,186.80. Following the transaction, the director directly owned 1,846 shares of the company's stock, valued at $543,905.44. This represents a 11.72% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Over the last quarter, insiders have sold 782 shares of company stock worth $229,572. Company insiders own 1.08% of the company's stock.

Hedge Funds Weigh In On Lithia Motors

Large investors have recently modified their holdings of the business. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. grew its stake in shares of Lithia Motors by 13.9% during the 1st quarter. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. now owns 8,474 shares of the company's stock worth $2,487,000 after purchasing an additional 1,032 shares during the period. Goldman Sachs Group Inc. raised its holdings in Lithia Motors by 67.6% during the first quarter. Goldman Sachs Group Inc. now owns 113,346 shares of the company's stock worth $33,272,000 after purchasing an additional 45,716 shares during the last quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC boosted its position in Lithia Motors by 16.8% during the first quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC now owns 93,170 shares of the company's stock worth $27,349,000 after purchasing an additional 13,407 shares in the last quarter. Federated Hermes Inc. grew its holdings in Lithia Motors by 16.2% in the second quarter. Federated Hermes Inc. now owns 2,430 shares of the company's stock valued at $821,000 after purchasing an additional 338 shares during the last quarter. Finally, WINTON GROUP Ltd purchased a new position in shares of Lithia Motors in the second quarter valued at $651,000.

Lithia Motors Company 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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