On February 14, 2024, Lithia Motors Inc. unveiled its Q4 results for FY23, revealing a mixed performance. While the company’s sales showed a commendable growth of 10.5% compared to the previous year, reaching $7.67 billion, it fell short of meeting the expectations set by analysts, who had anticipated sales of $7.95 billion. However, the adjusted earnings per share (EPS) of $8.24 aligned with analyst predictions.
The highlight of the company’s performance was the significant increase in new vehicle retail revenues, which saw a remarkable growth of 21.4% year-over-year. Additionally, used vehicle retail revenues also experienced a modest improvement of 1.8% compared to the previous year. Unfortunately, the total vehicle gross profit per unit experienced a decline, settling at $4,973, and the gross margin contracted by 100 basis points, reaching 16.4%. Adjusted operating margin also suffered a setback, declining by 60 basis points to 5.1%. Consequently, the adjusted operating income for the quarter decreased to $387.6 million, down from $393.4 million in the previous year.
Lithia Motors’ Board of Directors approved a dividend of $0.50 per share, which is scheduled to be paid on March 22, 2024, to shareholders of record on March 9, 2024. As of December 31, 2023, the company’s cash and equivalents amounted to $941.4 million, while inventories rose to $4.75 billion, compared to $3.41 billion the previous year.
Despite these mixed results, Lithia Motors’ stock price experienced a 1.00% decline, trading at $295.35 premarket on Wednesday, reflecting the market’s reaction to the earnings report. The dividend yield for Lithia Motors stands at approximately 0.7%, and dividend payments have shown consistent growth over the past decade. However, the stock’s free cash flow/dividend ratio is -24.65, surpassing the industry average of 5.91%. This suggests that the sustainability of the company’s dividend may be questionable.
LAD Stock Price Declines: Investors Concerned About Recent Drop
On February 14, 2024, LAD stock experienced a decline in its price momentum. According to data from CNN Money, LAD was trading near the top of its 52-week range and above its 200-day simple moving average. However, the stock price saw a significant drop of $11.57 since the market last closed, representing a 3.73% decrease.
The stock closed at $298.33, but in pre-market trading, it dropped further by $2.58. This decline in pre-market trading suggests that investors may have reacted negatively to some news or market conditions that emerged after the market closed on the previous day.
The fact that LAD was trading near the top of its 52-week range indicates that the stock had been performing well in recent times. This suggests that investors had confidence in the company and its prospects, leading to an increase in its stock price. However, the recent drop in price could be a cause for concern for investors.
Investors should closely monitor LAD’s performance and look for any additional information that may shed light on the reasons behind the drop in stock price. It is also advisable to consider consulting with a financial advisor or conducting further research before making any investment decisions regarding LAD or any other stock.
LAD Stock Reports Mixed Performance with Notable Increases in Revenue and Net Income
On February 14, 2024, LAD stock showcased a mixed performance as the company reported its financial results for the past year and the third quarter. The data reveals that LAD’s total revenue, net income, and earnings per share (EPS) experienced various changes compared to the previous year and the previous quarter.
Starting with total revenue, LAD reported $28.19 billion in revenue for the past year, which marks a notable increase of 23.46% compared to the previous year. However, LAD’s total revenue remained flat since the previous quarter.
Moving on to net income, LAD reported a net income of $1.25 billion for the past year, reflecting an 18.01% increase compared to the previous year. However, the net income decreased by 12.01% since the previous quarter.
Lastly, LAD’s earnings per share (EPS) stood at $44.20 for the past year, showing a significant increase of 20.93% compared to the previous year. However, similar to net income, the EPS decreased by 12.01% since the previous quarter.
Overall, LAD’s stock performance on February 14, 2024, showcased a mixed picture. While the company experienced a substantial increase in total revenue, net income, and EPS compared to the previous year, there was a decline in these metrics since the previous quarter. Investors will closely monitor future financial reports to determine whether this trend continues or if LAD can regain its growth momentum.
