Lithia Motors (NYSE:LAD) Posts Earnings Results, Misses Expectations By $1.35 EPS

Lithia Motors (NYSE:LAD) issued its quarterly earnings data on Wednesday. The company reported $6.74 earnings per share (EPS) for the quarter, missing analysts’ consensus estimates of $8.09 by ($1.35), FiscalAI reports. Lithia Motors had a return on equity of 12.76% and a net margin of 2.18%.The company had revenue of $9.20 billion for the quarter, compared to analysts’ expectations of $9.19 billion. During the same period last year, the company posted $7.79 EPS. The business’s revenue for the quarter was up .3% on a year-over-year basis.

Here are the key takeaways from Lithia Motors’ conference call:

• Record results — Q4 revenue of $9.2 billion and full-year revenue of $37.6 billion (+4%), with full-year adjusted diluted EPS of $33.46 (+16%), reflecting durable top-line and EPS growth.
• Driveway Finance (DFC) scaling — DFC delivered record income ($75M for 2025), managed receivables grew to $4.8 billion (+23%), penetration rose to ~17%–17.5% (target 20%), and management expects continued high-growth contribution to recurring, countercyclical income.
• Used and after‑sales strength — Used revenue +6.1% (units +4.7%) with Value Auto units +10.9%, while after‑sales revenue rose 10.9% and gross profit +9.8% (57.3% margin), supporting diversification versus new‑vehicle cycles.
• Margin and cost pressure — Total vehicle GPU compressed to $39.46 (down $258 YoY) and new vehicle GPU fell ~$300, while adjusted SG&A as a % of gross profit widened to 71.4% (from 66.3%), creating near‑term earnings pressure and requiring further cost/efficiency actions.
• Capital allocation — Management repurchased 11.4% of shares in 2025 (3.8% in Q4 at an average $314), acquired ~$2.4 billion of expected annualized revenue last year, and intends to balance opportunistic buybacks with $2–$4 billion of annual acquired revenue to accelerate shareholder returns.

Lithia Motors Price Performance

LAD traded down $2.40 during trading on Friday, reaching $302.12. The stock had a trading volume of 94,558 shares, compared to its average volume of 276,518. The business has a 50-day moving average of $334.00 and a 200-day moving average of $320.82. Lithia Motors has a one year low of $262.10 and a one year high of $388.36. The company has a debt-to-equity ratio of 1.46, a quick ratio of 0.30 and a current ratio of 1.17. The stock has a market cap of $7.33 billion, a PE ratio of 9.39 and a beta of 1.20.

Lithia Motors Dividend Announcement

The company also recently announced a quarterly dividend, which will be paid on Friday, March 20th. Investors of record on Friday, March 6th will be paid a $0.55 dividend. This represents a $2.20 dividend on an annualized basis and a yield of 0.7%. The ex-dividend date of this dividend is Friday, March 6th. Lithia Motors’s dividend payout ratio is currently 6.37%.

Analyst Upgrades and Downgrades

Several equities research analysts have recently weighed in on LAD shares. Weiss Ratings reiterated a “hold (c+)” rating on shares of Lithia Motors in a research report on Thursday, January 22nd. Benchmark reaffirmed a “buy” rating on shares of Lithia Motors in a report on Thursday, October 23rd. Citigroup raised their price target on shares of Lithia Motors from $385.00 to $399.00 and gave the company a “buy” rating in a report on Tuesday, October 28th. Evercore boosted their price target on shares of Lithia Motors from $440.00 to $500.00 and gave the company an “outperform” rating in a research report on Monday, November 24th. Finally, Wells Fargo & Company dropped their price objective on Lithia Motors from $358.00 to $355.00 and set an “equal weight” rating for the company in a research note on Thursday. Eight analysts have rated the stock with a Buy rating and three have issued a Hold rating to the company. According to MarketBeat.com, the company has an average rating of “Moderate Buy” and a consensus price target of $389.90.

Insider Activity

In other news, Director Congdon Stacy Loretz sold 75 shares of the stock in a transaction dated Friday, December 12th. The stock was sold at an average price of $360.00, for a total transaction of $27,000.00. Following the transaction, the director directly owned 1,810 shares in the company, valued at approximately $651,600. This represents a 3.98% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through this link. Insiders own 0.87% of the company’s stock.

Institutional Trading of Lithia Motors

Hedge funds and other institutional investors have recently bought and sold shares of the company. Dimensional Fund Advisors LP raised its stake in shares of Lithia Motors by 0.5% during the fourth quarter. Dimensional Fund Advisors LP now owns 1,346,783 shares of the company’s stock worth $447,583,000 after acquiring an additional 6,113 shares in the last quarter. Canada Pension Plan Investment Board grew its holdings in shares of Lithia Motors by 5.9% during the 2nd quarter. Canada Pension Plan Investment Board now owns 612,377 shares of the company’s stock valued at $206,873,000 after purchasing an additional 33,966 shares during the last quarter. Hotchkis & Wiley Capital Management LLC raised its position in Lithia Motors by 3.6% in the 3rd quarter. Hotchkis & Wiley Capital Management LLC now owns 426,120 shares of the company’s stock worth $134,654,000 after purchasing an additional 14,781 shares during the period. Ameriprise Financial Inc. lifted its stake in Lithia Motors by 18.0% in the third quarter. Ameriprise Financial Inc. now owns 221,928 shares of the company’s stock worth $70,131,000 after purchasing an additional 33,931 shares during the last quarter. Finally, Bank of America Corp DE boosted its position in Lithia Motors by 57.5% during the second quarter. Bank of America Corp DE now owns 197,417 shares of the company’s stock valued at $66,691,000 after buying an additional 72,061 shares during the period.

About Lithia Motors

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.