U.S. Markets open in 6 hrs 50 mins

Lithia Motors (LAD) Q1 Earnings Top Estimates, Revenues Miss

Zacks Equity Research

Lithia Motors, Inc. LAD reported adjusted earnings per share of $2.44 in first-quarter 2019, marking an 18% increase from $2.07 in the prior-year quarter. Further, the bottom line beat the Zacks Consensus Estimate of $2.15. This increase was owing to strong performance by the company’s three more-profitable business lines, consisting of retail used vehicles, finance and insurance (F&I), and service body and parts.

Reportedly, in the quarter under review, adjusted net income rose 9% year over year to $57 million. Total revenues in the quarter increased 7% year over year to $2.85 billion, narrowly missing the Zacks Consensus Estimate of $2.89 billion.

Gross profit rose 10.4% to $450.7 million in the quarter under review from $408.1 million in the year-ago quarter.

Lithia Motors, Inc. Price, Consensus and EPS Surprise

 

Lithia Motors, Inc. Price, Consensus and EPS Surprise | Lithia Motors, Inc. Quote

Quarter in Detail

Revenues from new-vehicle retail inched up 0.4% year over year to $1.46 billion in the reported quarter. New-vehicle retail unit sales declined 4.3% to 39,695. The average selling price of new-vehicle retail rose 5% to $36,809 from the year-ago figure.

Used-vehicle retail revenues increased 15.7% year over year to $828 million in the quarter under review while revenues from used-vehicle wholesale rose 1.8% to $77 million. Used-vehicle retail unit sales improved 12.6% to 40,675. The average selling price of used-vehicle retail gained 2.7% to $20,353 million from the year-ago figure.

Revenues from service body and parts went up 11.1% to $317 million. The company’s F&I business recorded 10.3% rise in revenues to $118 million. Revenues from fleet and others were $48.4 million compared with the year-ago figure of $21.2 million.

Financial Details

Lithia Motors had cash and cash equivalents of $45 million as of Mar 31, 2019, up from $31.6 million as of Dec 31, 2018. Long-term debt was $1.3 billion as of Mar 31, 2018, marking a decrease from $1.36 billion recorded on Dec 31, 2018.

Dividend Payment

Lithia Motors’ board approved a quarterly dividend of 30 cents per share for first-quarter 2019. The amount will be payable on May 24, 2019, to shareholders of record as of May 10, 2019.

Zacks Rank & Stocks to Consider

Lithia Motors currently carries a Zacks Rank #3 (Hold). A few better-ranked stocks in the broader auto sector are AB Volvo VLVLY, PACCAR Inc. PCAR and Fox Factory Holding Corporation FOXF, each currently carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Volvo has an expected long-term growth rate of 5%. The stock has gained 16.7% in the past three months.

PACCAR has an expected long-term growth rate of 8.4%. The stock has gained 14% in the past three months.

Fox Factory has an expected long-term growth rate of 15.1%. Over the past three months, shares of the company have gained 27.9%.

Radical New Technology Creates $12.3 Trillion Opportunity

Imagine buying Microsoft stock in the early days of personal computers… or Motorola after it released the world’s first cell phone. These technologies changed our lives and created massive profits for investors.

Today, we’re on the brink of the next quantum leap in technology. 7 innovative companies are leading this “4th Industrial Revolution” - and early investors stand to earn the biggest profits.

See the 7 breakthrough stocks now>>


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Lithia Motors, Inc. (LAD) : Free Stock Analysis Report
 
Fox Factory Holding Corp. (FOXF) : Free Stock Analysis Report
 
PACCAR Inc. (PCAR) : Free Stock Analysis Report
 
AB Volvo (VLVLY) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research