Lithia Motors (NYSE:LAD) Stock Rating Upgraded by UBS Group

Key Points

• UBS Group upgraded Lithia Motors to a “strong-buy” rating, adding to a generally constructive analyst backdrop for the stock.
• Recent company results were solid, with Lithia posting $7.34 EPS versus $7.06 expected and revenue of $9.27 billion, slightly ahead of estimates.
• The company’s board approved a $500 million share repurchase program, which would allow it to buy back up to 7.9% of outstanding shares and may signal management sees the stock as undervalued.

Lithia Motors (NYSE:LAD - Get Free Report) was upgraded by analysts at UBS Group to a "strong-buy" rating in a research report issued on Wednesday,Zacks.com reports.

Several other analysts also recently weighed in on LAD. Wells Fargo & Company upped their price target on Lithia Motors from $293.00 to $305.00 and gave the stock an "equal weight" rating in a research note on Thursday, April 30th. Bank of America cut their target price on Lithia Motors from $335.00 to $320.00 in a research note on Monday, April 13th. Wall Street Zen downgraded Lithia Motors from a "hold" rating to a "sell" rating in a research note on Saturday, February 28th. Weiss Ratings downgraded Lithia Motors from a "hold (c)" rating to a "hold (c-)" rating in a research note on Monday, May 4th. Finally, Citigroup increased their target price on Lithia Motors from $326.00 to $365.00 and gave the company a "buy" rating in a research note on Friday, May 1st. One investment analyst has rated the stock with a Strong Buy rating, six have assigned a Buy rating and six have given a Hold rating to the stock. According to data from MarketBeat.com, the stock currently has an average rating of "Moderate Buy" and an average price target of $365.30.

Lithia Motors Stock Performance

Lithia Motors stock opened at $296.22 on Wednesday. The company has a quick ratio of 0.24, a current ratio of 0.99 and a debt-to-equity ratio of 1.41. The company has a market capitalization of $6.76 billion, a P/E ratio of 10.40, a PEG ratio of 0.65 and a beta of 1.28. The stock's 50 day moving average is $270.59 and its 200 day moving average is $298.62. Lithia Motors has a twelve month low of $239.78 and a twelve month high of $360.55.

Lithia Motors (NYSE:LAD - Get Free Report) last posted its quarterly earnings results on Wednesday, April 29th. The company reported $7.34 earnings per share for the quarter, topping the consensus estimate of $7.06 by $0.28. The company had revenue of $9.27 billion for the quarter, compared to the consensus estimate of $9.22 billion. Lithia Motors had a return on equity of 12.49% and a net margin of 1.88%.The firm's quarterly revenue was up 1.0% compared to the same quarter last year. During the same quarter in the prior year, the business posted $7.66 EPS. On average, equities research analysts predict that Lithia Motors will post 34.26 earnings per share for the current fiscal year.

Lithia Motors announced that its Board of Directors has approved a stock repurchase plan on Tuesday, May 26th that allows the company to buyback $500.00 million in outstanding shares. This buyback authorization allows the company to repurchase up to 7.9% of its stock through open market purchases. Stock buyback plans are often an indication that the company's management believes its stock is undervalued.

Insider Buying and Selling at Lithia Motors

In other news, Director Richard J. Bailey, Jr. sold 297 shares of the stock in a transaction on Tuesday, May 26th. The stock was 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 of the company's stock, valued at $213,233.20. This represents a 28.10% decrease in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available through this link. Also, Director Shauna Mcintyre sold 245 shares of the stock in a transaction on Monday, May 11th. The shares were sold at an average price of $294.64, for a total value of $72,186.80. Following the transaction, the director directly owned 1,846 shares in the company, valued at $543,905.44. The trade was a 11.72% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Over the last quarter, insiders have sold 617 shares of company stock worth $174,966. Company insiders own 1.08% of the company's stock.

Hedge Funds Weigh In On Lithia Motors

Several hedge funds and other institutional investors have recently modified their holdings of LAD. Norges Bank bought a new position in shares of Lithia Motors during the 4th quarter valued at $125,214,000. River Road Asset Management LLC lifted its holdings 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 valued at $246,814,000 after buying an additional 186,628 shares during the period. Life Cycle Investment Partners Ltd bought a new position in shares of Lithia Motors during the 4th quarter valued at $58,409,000. Corient Private Wealth LLC lifted its holdings in shares of Lithia Motors by 8,474.0% during the 4th quarter. Corient Private Wealth LLC now owns 107,690 shares of the company's stock valued at $35,789,000 after buying an additional 106,434 shares during the period. Finally, Marshall Wace LLP lifted its holdings in shares of Lithia Motors by 183.6% during the 4th quarter. Marshall Wace LLP now owns 162,937 shares of the company's stock valued at $54,149,000 after buying an additional 105,478 shares during the period.

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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