LITHIA MOTORS INC (LAD) Stock Fundamental Analysis
NYSE:LAD - New York Stock Exchange, Inc. - US5367971034 - Common Stock - Currency: USD
Overall LAD gets a fundamental rating of 5 out of 10. We evaluated LAD against 120 industry peers in the Specialty Retail industry. There are concerns on the financial health of LAD while its profitability can be described as average. LAD is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
LAD had positive earnings in the past year.
In the past year LAD had a positive cash flow from operations.
Each year in the past 5 years LAD has been profitable.
The reported operating cash flow has been mixed in the past 5 years: LAD reported negative operating cash flow in multiple years.
1.2 Ratios
The Return On Assets of LAD (3.44%) is better than 62.39% of its industry peers.
With a decent Return On Equity value of 12.10%, LAD is doing good in the industry, outperforming 69.23% of the companies in the same industry.
LAD has a Return On Invested Capital of 5.40%. This is comparable to the rest of the industry: LAD outperforms 58.12% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for LAD is below the industry average of 12.30%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.44% | ||
| ROE | 12.1% | ||
| ROIC | 5.4% |
ROA(3y)5.63%
ROA(5y)6.47%
ROE(3y)17.38%
ROE(5y)18.54%
ROIC(3y)7.56%
ROIC(5y)8.53%
1.3 Margins
Looking at the Profit Margin, with a value of 2.30%, LAD is in line with its industry, outperforming 59.83% of the companies in the same industry.
LAD's Profit Margin has been stable in the last couple of years.
LAD's Operating Margin of 4.49% is fine compared to the rest of the industry. LAD outperforms 62.39% of its industry peers.
LAD's Operating Margin has improved in the last couple of years.
With a Gross Margin value of 15.72%, LAD is not doing good in the industry: 88.03% of the companies in the same industry are doing better.
In the last couple of years the Gross Margin of LAD has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 4.49% | ||
| PM (TTM) | 2.3% | ||
| GM | 15.72% |
OM growth 3Y-16.19%
OM growth 5Y2.4%
PM growth 3Y-21.88%
PM growth 5Y0.62%
GM growth 3Y-6.21%
GM growth 5Y-0.04%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), LAD is destroying value.
Compared to 1 year ago, LAD has less shares outstanding
The number of shares outstanding for LAD has been increased compared to 5 years ago.
Compared to 1 year ago, LAD has a worse debt to assets ratio.
2.2 Solvency
An Altman-Z score of 2.46 indicates that LAD is not a great score, but indicates only limited risk for bankruptcy at the moment.
LAD's Altman-Z score of 2.46 is in line compared to the rest of the industry. LAD outperforms 52.99% of its industry peers.
LAD has a Debt/Equity ratio of 2.01. This is a high value indicating a heavy dependency on external financing.
LAD's Debt to Equity ratio of 2.01 is on the low side compared to the rest of the industry. LAD is outperformed by 70.09% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.01 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 2.46 |
ROIC/WACC0.59
WACC9.08%
2.3 Liquidity
A Current Ratio of 1.18 indicates that LAD should not have too much problems paying its short term obligations.
With a Current ratio value of 1.18, LAD is not doing good in the industry: 64.96% of the companies in the same industry are doing better.
LAD has a Quick Ratio of 1.18. This is a bad value and indicates that LAD is not financially healthy enough and could expect problems in meeting its short term obligations.
LAD has a Quick ratio of 0.27. This is in the lower half of the industry: LAD underperforms 76.92% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.18 | ||
| Quick Ratio | 0.27 |
3. Growth
3.1 Past
LAD shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -18.62%.
LAD shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 20.64% yearly.
Looking at the last year, LAD shows a quite strong growth in Revenue. The Revenue has grown by 16.75% in the last year.
LAD shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 23.38% yearly.
EPS 1Y (TTM)-18.62%
EPS 3Y-8.87%
EPS 5Y20.64%
EPS Q2Q%-5.46%
Revenue 1Y (TTM)16.75%
Revenue growth 3Y16.65%
Revenue growth 5Y23.38%
Sales Q2Q%20.17%
3.2 Future
The Earnings Per Share is expected to grow by 19.24% on average over the next years. This is quite good.
Based on estimates for the next years, LAD will show a small growth in Revenue. The Revenue will grow by 5.36% on average per year.
EPS Next Y17.1%
EPS Next 2Y17.09%
EPS Next 3Y18.46%
EPS Next 5Y19.24%
Revenue Next Year7.45%
Revenue Next 2Y7.59%
Revenue Next 3Y9.34%
Revenue Next 5Y5.36%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
LAD is valuated reasonably with a Price/Earnings ratio of 11.68.
Based on the Price/Earnings ratio, LAD is valued cheaper than 82.91% of the companies in the same industry.
LAD's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 29.63.
LAD is valuated reasonably with a Price/Forward Earnings ratio of 9.97.
82.91% of the companies in the same industry are more expensive than LAD, based on the Price/Forward Earnings ratio.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.68, LAD is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.68 | ||
| Fwd PE | 9.97 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as LAD.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 9.68 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
LAD's earnings are expected to grow with 18.46% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.68
PEG (5Y)0.57
EPS Next 2Y17.09%
EPS Next 3Y18.46%
5. Dividend
5.1 Amount
LAD has a yearly dividend return of 0.59%, which is pretty low.
Compared to an average industry Dividend Yield of 4.31, LAD pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 2.27, LAD's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.59% |
5.2 History
On average, the dividend of LAD grows each year by 11.75%, which is quite nice.
LAD has paid a dividend for at least 10 years, which is a reliable track record.
LAD has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)11.75%
Div Incr Years11
Div Non Decr Years11
5.3 Sustainability
7.02% of the earnings are spent on dividend by LAD. This is a low number and sustainable payout ratio.
The dividend of LAD is growing, but earnings are growing more, so the dividend growth is sustainable.
DP7.02%
EPS Next 2Y17.09%
EPS Next 3Y18.46%
350.14
-10.56 (-2.93%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)
Earnings (Next)
Inst Owners104.39%
Inst Owner Change-1.09%
Ins Owners0.93%
Ins Owner Change-7.5%
Market Cap9.33B
Analysts80
Price Target435.83 (24.47%)
Short Float %7.21%
Short Ratio5.39
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.59% |
Yearly Dividend2.09
Dividend Growth(5Y)11.75%
DP7.02%
Div Incr Years11
Div Non Decr Years11
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)8.95%
Min EPS beat(2)7.02%
Max EPS beat(2)10.88%
EPS beat(4)2
Avg EPS beat(4)-1.6%
Min EPS beat(4)-23.36%
Max EPS beat(4)10.88%
EPS beat(8)3
Avg EPS beat(8)-1.86%
EPS beat(12)5
Avg EPS beat(12)0.52%
EPS beat(16)9
Avg EPS beat(16)8.34%
Revenue beat(2)0
Avg Revenue beat(2)-2.88%
Min Revenue beat(2)-3.72%
Max Revenue beat(2)-2.05%
Revenue beat(4)0
Avg Revenue beat(4)-2.91%
Min Revenue beat(4)-4.48%
Max Revenue beat(4)-1.4%
Revenue beat(8)1
Avg Revenue beat(8)-2.3%
Revenue beat(12)3
Avg Revenue beat(12)-1.25%
Revenue beat(16)6
Avg Revenue beat(16)1.05%
PT rev (1m)1.73%
PT rev (3m)15.98%
EPS NQ rev (1m)-0.31%
EPS NQ rev (3m)-1.35%
EPS NY rev (1m)-0.39%
EPS NY rev (3m)-0.07%
Revenue NQ rev (1m)1.07%
Revenue NQ rev (3m)1.21%
Revenue NY rev (1m)0.29%
Revenue NY rev (3m)0.29%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.68 | ||
| Fwd PE | 9.97 | ||
| P/S | 0.27 | ||
| P/FCF | N/A | ||
| P/OCF | 136.97 | ||
| P/B | 1.41 | ||
| P/tB | 4.9 | ||
| EV/EBITDA | 9.68 |
EPS(TTM)29.98
EY8.56%
EPS(NY)35.11
Fwd EY10.03%
FCF(TTM)-10.15
FCFYN/A
OCF(TTM)2.56
OCFY0.73%
SpS1302.14
BVpS247.92
TBVpS71.44
PEG (NY)0.68
PEG (5Y)0.57
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.44% | ||
| ROE | 12.1% | ||
| ROCE | 9.39% | ||
| ROIC | 5.4% | ||
| ROICexc | 5.45% | ||
| ROICexgc | 6.98% | ||
| OM | 4.49% | ||
| PM (TTM) | 2.3% | ||
| GM | 15.72% | ||
| FCFM | N/A |
ROA(3y)5.63%
ROA(5y)6.47%
ROE(3y)17.38%
ROE(5y)18.54%
ROIC(3y)7.56%
ROIC(5y)8.53%
ROICexc(3y)7.79%
ROICexc(5y)8.75%
ROICexgc(3y)10.24%
ROICexgc(5y)11.02%
ROCE(3y)12.35%
ROCE(5y)13.82%
ROICexcg growth 3Y-23.11%
ROICexcg growth 5Y-1.46%
ROICexc growth 3Y-24.37%
ROICexc growth 5Y-3.43%
OM growth 3Y-16.19%
OM growth 5Y2.4%
PM growth 3Y-21.88%
PM growth 5Y0.62%
GM growth 3Y-6.21%
GM growth 5Y-0.04%
F-Score4
Asset Turnover1.49
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.01 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 7.27 | ||
| Cap/Depr | 125.85% | ||
| Cap/Sales | 0.98% | ||
| Interest Coverage | 2.22 | ||
| Cash Conversion | 3.73% | ||
| Profit Quality | N/A | ||
| Current Ratio | 1.18 | ||
| Quick Ratio | 0.27 | ||
| Altman-Z | 2.46 |
F-Score4
WACC9.08%
ROIC/WACC0.59
Cap/Depr(3y)N/A
Cap/Depr(5y)N/A
Cap/Sales(3y)0.93%
Cap/Sales(5y)1.04%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-18.62%
EPS 3Y-8.87%
EPS 5Y20.64%
EPS Q2Q%-5.46%
EPS Next Y17.1%
EPS Next 2Y17.09%
EPS Next 3Y18.46%
EPS Next 5Y19.24%
Revenue 1Y (TTM)16.75%
Revenue growth 3Y16.65%
Revenue growth 5Y23.38%
Sales Q2Q%20.17%
Revenue Next Year7.45%
Revenue Next 2Y7.59%
Revenue Next 3Y9.34%
Revenue Next 5Y5.36%
EBIT growth 1Y-9.12%
EBIT growth 3Y-2.23%
EBIT growth 5Y26.34%
EBIT Next Year18.48%
EBIT Next 3Y15.13%
EBIT Next 5Y13.64%
FCF growth 1Y48.69%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y125.24%
OCF growth 3Y-42.59%
OCF growth 5Y-8.3%