Lithia Motors (NYSE:LAD) Stock Price Down 4.6% - Time to Sell?

Key Points

• Lithia Motors (NYSE:LAD) shares fell 4.6%, last trading at $306.36, with trading volume down to 70,335 shares compared to an average of 329,081 shares.
• Analysts have mixed opinions, with Citigroup raising their price target from $378 to $383, while Wells Fargo cut theirs from $364 to $317; overall, the stock holds a consensus price target of $376.50.
• The company recently announced a stock repurchase plan allowing up to $750 million in buybacks, indicating confidence in its undervalued stock, alongside a quarterly dividend of $0.55 per share.

Lithia Motors, Inc. (NYSE:LAD - Get Free Report) shares traded down 4.6% during mid-day trading on Monday . The stock traded as low as $309.01 and last traded at $306.36. 70,335 shares changed hands during mid-day trading, a decline of 79% from the average session volume of 329,081 shares. The stock had previously closed at $320.96.

Analyst Upgrades and Downgrades

Several analysts have issued reports on the company. Citigroup upped their target price on Lithia Motors from $378.00 to $383.00 and gave the stock a "buy" rating in a research note on Tuesday, August 5th. Wells Fargo & Company lowered their price objective on Lithia Motors from $364.00 to $317.00 and set an "equal weight" rating for the company in a research report on Wednesday, July 30th. Guggenheim lowered their price objective on Lithia Motors from $383.00 to $380.00 and set a "buy" rating for the company in a research report on Monday, August 11th. Bank of America lowered their price objective on Lithia Motors from $500.00 to $385.00 and set a "buy" rating for the company in a research report on Wednesday, September 10th. Finally, Weiss Ratings restated a "buy (b-)" rating on shares of Lithia Motors in a report on Saturday, September 27th. Nine research analysts have rated the stock with a Buy rating and two have issued a Hold rating to the company. According to MarketBeat, Lithia Motors has an average rating of "Moderate Buy" and a consensus price target of $376.50.

Lithia Motors Stock Performance

The business has a fifty day simple moving average of $319.16 and a 200-day simple moving average of $315.48. The company has a quick ratio of 0.29, a current ratio of 1.22 and a debt-to-equity ratio of 1.24. The firm has a market cap of $8.03 billion, a P/E ratio of 9.28, a P/E/G ratio of 0.65 and a beta of 1.28.

Lithia Motors (NYSE:LAD - Get Free Report) last issued its quarterly earnings results on Tuesday, July 29th. The company reported $10.24 earnings per share for the quarter, beating the consensus estimate of $9.78 by $0.46. Lithia Motors had a return on equity of 13.21% and a net margin of 2.39%.The firm had revenue of $9.58 billion during the quarter, compared to the consensus estimate of $9.56 billion. On average, sell-side analysts predict that Lithia Motors, Inc. will post 34.45 EPS for the current fiscal year.

Lithia Motors Announces Dividend

The business also recently declared a quarterly dividend, which was paid on Friday, August 22nd. Stockholders of record on Friday, August 8th were issued a dividend of $0.55 per share. The ex-dividend date was Friday, August 8th. This represents a $2.20 annualized dividend and a dividend yield of 0.7%. Lithia Motors's dividend payout ratio (DPR) is presently 6.52%.

Lithia Motors announced that its board has approved a stock repurchase plan on Tuesday, August 26th that allows the company to buyback $750.00 million in outstanding shares. This buyback authorization allows the company to purchase up to 9% of its shares through open market purchases. Shares buyback plans are usually a sign that the company's board of directors believes its stock is undervalued.

Insider Activity at Lithia Motors

In related news, Director Shauna Mcintyre sold 256 shares of the stock in a transaction on Thursday, July 31st. The stock was sold at an average price of $293.05, for a total transaction of $75,020.80. Following the sale, the director directly owned 1,376 shares of the company's stock, valued at $403,236.80. This trade represents a 15.69% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which is available at the SEC website. 0.87% of the stock is owned by company insiders.

Institutional Inflows and Outflows

Several institutional investors and hedge funds have recently bought and sold shares of LAD. Abrams Capital Management L.P. raised its stake in shares of Lithia Motors by 2.2% in the first quarter. Abrams Capital Management L.P. now owns 2,444,678 shares of the company's stock worth $717,611,000 after buying an additional 53,490 shares during the period. Coppell Advisory Solutions LLC raised its stake in Lithia Motors by 10,136,710.0% during the 1st quarter. Coppell Advisory Solutions LLC now owns 2,027,362 shares of the company's stock valued at $595,112,000 after purchasing an additional 2,027,342 shares during the period. Dimensional Fund Advisors LP raised its stake in Lithia Motors by 6.1% during the 1st quarter. Dimensional Fund Advisors LP now owns 1,267,519 shares of the company's stock valued at $372,053,000 after purchasing an additional 72,980 shares during the period. Canada Pension Plan Investment Board boosted its holdings in shares of Lithia Motors by 5.9% in the 2nd quarter. Canada Pension Plan Investment Board now owns 612,377 shares of the company's stock worth $206,873,000 after purchasing an additional 33,966 shares during the period. Finally, Geode Capital Management LLC boosted its holdings in Lithia Motors by 2.5% during the 2nd quarter. Geode Capital Management LLC now owns 479,537 shares of the company's stock valued at $162,022,000 after acquiring an additional 11,859 shares during the period.

About Lithia Motors

Lithia Motors, Inc operates as an automotive retailer worldwide. It operates in two segments, Vehicle Operations and Financing Operations. The company's Vehicle Operations segment sells new and used vehicles; provides parts, repair, and maintenance services; vehicle finance; and insurance products. Its Financing Operations segment provides financing to customers buying and leasing retail vehicles.

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