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Investment thesis
Lithia Motors, Inc. (NYSE:LAD) net income and EPS are back on the growth track, after eight quarters of declines.
An analysis of its fundamentals suggests it is well positioned to keep
Lithia Motors: Earnings Back On The Growth Track
Summary
- Lithia Motors' net income and EPS have resumed growth, with strong fundamentals supporting continued bottom-line expansion over the next several years.
- The company leverages disciplined acquisitions, rural market focus, and manufacturer exclusivity to maintain a medium moat and offset declining profit per unit.
- Management's strategy combines organic and acquired growth, with Wall Street projecting double-digit earnings growth through 2027 and resilience to current tariff risks.
- Given a nearly 12% expected share price increase in the coming year and solid execution, I rate Lithia a Buy for growth-oriented investors.
Robert F. Abbott has been investing his family’s accounts since 1995, and in 2010 added options, mainly covered calls and collars with long stocks. He is a freelance writer, and his projects include a website that provides information for new and intermediate-level mutual fund investors. A resident of Airdrie, Alberta, Canada, Robert has earned Bachelor of Arts and Master of Business Administration (MBA) degrees.
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