Lithia Motors Inc (LAD) fair value: what the stock is really worth
As of Sep 24, 2026: fair value of Lithia Motors Inc $499, price $310, upside +61.0%, quality 44 out of 100. Calculated from audited financials with 26 valuation models and 37 quality factors, updated daily.
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Price vs Fair Value
White line = price, green steps = our fair value per fiscal year, dashed = 300-day average. As of Sep 23, 2026.
How to read this chart
60‑month range $178.07 – $427.48 · fair‑value band $259.50 – $1,022 · the $309.60 price screens below the $498.50 fair value. Green steps = our fair value per fiscal year (point-in-time, no hindsight). Dashed = 300-day average. As of Sep 23, 2026.
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Lithia Motors, Inc. operates as an automotive retailer in the United States, the United Kingdom, and Canada. The company operates in two segments, Vehicle Operations and Financing Operations.
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Lithia Motors, Inc. operates as an automotive retailer in the United States, the United Kingdom, and Canada. The company operates in two segments, Vehicle Operations and Financing Operations. It offers a range of products and services fulfilling the entire vehicle ownership lifecycle, including new and used vehicles, financing and insurance products, and aftersales automotive repair and maintenance services. The company provides its products and services through a network of physical locations, e-commerce platforms, captive finance solutions, fleet management offerings, and other synergistic adjacencies. Lithia Motors, Inc. was founded in 1946 and is headquartered in Medford, Oregon.
Stock analysis
Lithia Motors Inc (LAD) currently trades at $309.60, while our model-based Fair Value estimate is $498.50, implying the stock looks roughly 37.9% undervalued today.
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Valuation
Bull case: the Growth Earnings group reads highest at a median of $911.66 per share, and 20 of the 25 models we run sit above the $309.60 price.
Bear case: the Economic Profit group reads lowest at $119.57, and 5 of the 25 models stay below the price. Evidence for this calculation is high.
Scenario range: $259.50 (bear) to $1,022 (bull), the price of $309.60 sits inside it. Bear and bull are the same models on cautious and optimistic assumptions, a range, not a price target.
Quality & growth
The Quality Score stands at 44/100 (below-average quality), in the Consumer Cyclical sector.
Expensive Growth: The company is growing, but growth may require heavy reinvestment or weak cash conversion.
Lithia Motors Inc reported revenue of $37.6B in FY2025 versus $22.8B in FY2021, a compound +13.3%/yr. Reported net income was $820M in FY2025, compounding −6.2%/yr from FY2021.
Key figures
Market cap $7.9B · P/E ratio 10.6 · P/S ratio 0.23 · EPS (TTM) $29.34 · Dividend yield 0.7% · Net margin 2.2% · Return on equity 10.9% · Return on assets (EBIT) 9.8%.
Competitive moat
Our AI-assisted moat analysis scores the competitive advantage at 47 out of 100 (low confidence).
What moves the price
The share trades about 28% below its 52-week high and 28% above its 52-week low, currently below its 200-day average.
For context, the median of 10 Consumer Cyclical peers we cover trades at 10% fair-value upside, at 61%, LAD screens cheaper than that median.
Fair Value models
Bear $259.50Fair Value $498.50Bull $1,022
Model ⓘEach model values the company its own way (discounted cash flow, earnings, assets, dividends). The fair value above is their evidence-weighted blend, not the output of a single model. Based on fiscal year 2025 figures (about 9 months old). Earnings retained since then ($19.91 per share) are deliberately not added.Bear ⓘBear = the cautious scenario: the same model computed with conservative anchors (lower growth, margins and valuation multiples). Together with Bull it frames a plausible valuation range, not a price target.BaseBull ⓘBull = the optimistic scenario: the same model computed with favourable anchors (higher growth, margins and valuation multiples). Together with Bear it frames a plausible valuation range, not a price target.Evidence ⓘEvidence = how well-backed THIS model's estimate is for this stock (0–100): how complete and reliable its input data are, and how well the model fits the company. The final Fair Value is an evidence-weighted blend, so better-evidenced models count more. Green ≥70, amber 50–69, grey below 50.
Growth Quality ⓘGrowth is valuable only when reinvestment earns attractive returns (Aswath Damodaran): sustainable growth depends on return on capital, reinvestment and efficiency. Basis: total company revenue over the periods shown on the cards (3Y/5Y/all years), not per share, so a merger can show up as a growth jump; per-share earnings growth is in the value-creation card.62/100
The company is growing, but growth may require heavy reinvestment or weak cash conversion.
Revenue growth 1 year
+4.0%
Revenue growth 3 years ⓘMeasures the company's TOTAL revenue from reported annual statements: compound average growth per year (CAGR) from the fiscal year 3, 5 or N years back to the most recent comparable fiscal year. Not per share: buybacks do not change this number, and a merger can appear as a growth jump. Per-share growth (which does include buybacks) is in the value-creation card.
+10.1%
Revenue growth 5 years ⓘMeasures the company's TOTAL revenue from reported annual statements: compound average growth per year (CAGR) from the fiscal year 3, 5 or N years back to the most recent comparable fiscal year. Not per share: buybacks do not change this number, and a merger can appear as a growth jump. Per-share growth (which does include buybacks) is in the value-creation card.
+23.4%
Start year 2020 (pandemic). Over 10 years: +16.9% a year
Revenue growth 30 years ⓘMeasures the company's TOTAL revenue from reported annual statements: compound average growth per year (CAGR) from the fiscal year 3, 5 or N years back to the most recent comparable fiscal year. Not per share: buybacks do not change this number, and a merger can appear as a growth jump. Per-share growth (which does include buybacks) is in the value-creation card.
+21.3%
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What shareholders gained per year (last 5 years) ⓘWhat the business itself delivers per year: earnings growth per share plus the dividend yield. This is what you get IF the market keeps valuing the stock the same way: it contains no assumption about the market changing its mind. Computed per share, so buybacks count and a merger does not pass as growth. For a company that pays no dividend it is pure earnings growth per share. Period: earnings growth per share as CAGR over the last 5 reported fiscal years (annual statements), plus the current dividend yield. The start value is the median of the three years around the start, so a single crisis year (a pandemic or a write-down) does not distort the rate. Basis: adjusted.
+13.7%
Earnings growth per share plus dividend.
Earnings per share, growth per year+13.0%
Dividend (yield on the price)0.7%
Pace: 5 vs 10 years ⓘTwo data points, not a trend model: earnings growth per share over the last 5 fiscal years against the last 10. Labelled "steady" when both rates are within 3 percentage points of each other, otherwise picking up or flattening. Shown only when ten years of history exist.11% vs 17%, slowing
Profit margin 2020 to 2025 ⓘOperating margin then vs now, from reported annual statements. A falling margin after a boom year is the classic peak-earnings signal: the growth rate then leans on an inflated base.5% → 4%
Start year 2020 (pandemic)
Growth Forecast
A lot of optimism in the price
The price assumes more growth than the company has delivered so far and more than analysts expect.
What the price assumes ⓘThis turns our valuation around: instead of asking what the share is worth, it asks what growth the current price requires. It uses the cash the company keeps after all spending (free cash flow), the same discount rate as our models, five years of growth, then slowing evenly to 2 % a year by year ten. Compared with the analysts' sales forecasts extended to the same five years (at least three analysts, for context only, it does not enter the Fair Value): within 3 percentage points counts as "in line" (amber), below that little optimism (green), above that a lot of optimism (red).
+46.4%
Yearly growth needed for the next five years to justify today's price.
What forecasts expect ⓘAnalysts publish sales forecasts for the next two fiscal years. For the years after that, growth slows evenly to 2 % a year by year ten (2 % is the long-run rate our models use). Projected years are marked as such.
+3.1%
Yearly sales growth analysts expect, extended to five years.
After inflation (USA: IMF forecast 2.4% a year to 2030, 3.1% from 2016 to 2025) that is about +43.0% a year for the price and +0.7% for the forecasts.
News mood ⓘNews mood, the average tone of recent news (94 articles), rated against how stocks are usually covered. 🚀 Hype = unusually upbeat · 🙂 Positive = above average · 😐 Neutral = typical · 🙁 Negative = below average · 😨 Very negative = unusually downbeat. It reflects the tone of coverage, not our valuation.Positive
Recent news coverage is more positive than average.
Price, fair value, quality and upside side by side.
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Peer GroupⓘHow this stock ranks against its industry: the green marker is this stock, the band is the typical 25–75% peer range, and the tick is the median.Auto & Truck Dealerships · 106 stocks
Beats the industry median on 8/14 measures
A mixed picture versus its industry peers.
Valuation
Quality Score44 · Below median
Fair Value upside+61% · Above median
Profitability
Return on equity (TTM)11% · Above median
Return on assets4% · Above median
Net margin (TTM)2% · Above median
Operating margin (TTM)4% · Above median
Growth and dividend
Revenue growth1% · Below median
Dividend yield (TTM)0.7% · Bottom 25%
Balance sheet
Debt / equity1.46× · Highest 25%
Valuation Multiplesvs Auto & Truck Dealerships median · lower = cheaper
P/E (TTM)10.6× · Cheaper than median
P/B1.19× · book value is mostly goodwill ⓘGoodwill and other intangible assets are larger than the equity. The book value mainly reflects prices paid for past acquisitions, so we do not rank this P/B against the peer group.
For bloggers, editors and developers: paste this into your site or blog (a “Custom HTML” block in WordPress), it shows the current fair value and links back here. Free, plain HTML, and welcome. Full data streams (CSV/JSON) at /developers.
Is Lithia Motors Inc (LAD) overvalued or undervalued?
As of Sep 23, 2026, our model estimates a fair value of $498.50 versus a price of $309.60, about +61% upside (undervalued).
What is the fair value of LAD?
Our model-based fair value for Lithia Motors Inc is $498.50 (as of Sep 23, 2026), built from audited fundamentals. The current price: $309.60.
What is the quality score of LAD?
Lithia Motors Inc has a Quality Score of 44/100. It measures business quality (profitability, growth, cash flow, balance-sheet strength, investment discipline, share issuance). Market factors such as price momentum and volatility do not enter the number; they are shown separately in the detail view.
What is the price target for Lithia Motors Inc (LAD)?
Our model-based price target is the fair value of $498.50 (as of Sep 23, 2026) from 25 valuation models. Cautious scenario $259.50, optimistic scenario $1,022. It is a calculation from audited fundamentals, not an analyst target.
What is the Lithia Motors Inc stock forecast for 2026?
Our models put fair value at $498.50, about +61% upside versus a price of $309.60 (undervalued). Cautious scenario $259.50, optimistic scenario $1,022. The calculation is refreshed regularly with new filings.
What is the revenue of Lithia Motors Inc (LAD)?
Lithia Motors Inc reported trailing-twelve-month revenue of about $37.7B (latest available figure, as of Sep 23, 2026).
Does Lithia Motors Inc pay a dividend?
Lithia Motors Inc currently shows a dividend yield of about 0.72% relative to its recent price (as of Sep 23, 2026).
What growth is priced into Lithia Motors Inc (LAD)?
For today's price to be fair in a discounted-cash-flow model, Lithia Motors Inc would have to grow free cash flow by +46.4 % per year for five years (discount rate 10.4 %, then slowing evenly to 2 % perpetual growth by year ten). Over the last 5 years revenue grew +23.5 % per year. As of Sep 23, 2026.
What discount rate (WACC) does the fair value of LAD use?
Our models discount Lithia Motors Inc at 10.4 %: a base by market capitalisation (mid), damped by beta 1.26, country premium for USA. The same rate applies in all 26 models.
What is a reverse DCF?
A reverse DCF turns the usual calculation around. Instead of deriving a value from assumptions, it takes today's price as given and asks: what free-cash-flow growth would a company have to deliver for exactly this price to be fair? The result is not a forecast but the expectation already priced in. For Lithia Motors Inc that is +46.4 % per year a year over ten years, using the same discount rate (10.4 %) and the same formula as our fair value.
How much growth has Lithia Motors Inc (LAD) delivered so far?
Over the past 5 years revenue at Lithia Motors Inc grew +23.5 % a year. The price currently implies +46.4 % per year free-cash-flow growth a year. Comparing the two shows how much confidence is in the price: if it demands more than has been delivered, the business has to accelerate for the maths to work.
How fast is the sector of Lithia Motors Inc (LAD) growing?
The median revenue growth in the sector is +2.6 % a year. That is the yardstick for the growth priced into Lithia Motors Inc (+46.4 % per year a year): it shows whether the expectation is within the usual range or beyond it.
What is the free cash flow yield of Lithia Motors Inc (LAD)?
The free-cash-flow yield on the price is 2.44 %: that much free cash flow Lithia Motors Inc produces per unit of market value. When it exceeds the discount rate of our models (10.4 %), the business already earns more than its cost of capital demands, and the price needs little additional growth.
What is the intrinsic value of Lithia Motors Inc (LAD)?
Intrinsic value and fair value mean the same thing: what the business is worth on its numbers, independent of the share price. For Lithia Motors Inc it is $498.50 per share (as of Sep 23, 2026), against a price of $309.60. It is the blended result of 25 valuation models (cash flow, earnings, asset, dividend).
Is Lithia Motors Inc stock overvalued or undervalued in 2026?
As of Sep 23, 2026, LAD trades below its calculated fair value: price $309.60, fair value $498.50, a gap of about +61% (undervalued). The calculation is refreshed with each new quarterly report, so the verdict can change during the year.
Is fair value the same as the market price of LAD?
No. The price is what the market pays today ($309.60); the fair value is what the company's own numbers justify ($498.50). For Lithia Motors Inc the two are $188.90 per share apart. That gap is exactly why we show both numbers side by side.
How much is Lithia Motors Inc worth?
The market values Lithia Motors Inc at about $7.9B (market capitalisation, as of Sep 23, 2026). Per share that is $309.60; our models calculate a fair value of $498.50 per share.
What do the bullish and bearish scenarios say about LAD?
Our models span a range for Lithia Motors Inc: cautious scenario $259.50, base $498.50, optimistic $1,022 per share (as of Sep 23, 2026, price $309.60). The range comes from different growth and margin assumptions, not from analyst opinions.
What is the P/E ratio of LAD?
Lithia Motors Inc trades at a price-to-earnings ratio of 10.6 (as of Sep 23, 2026). A P/E on its own says little: it compares the price with ONE year of profit, while our fair value of $498.50 is built from several models across several years. Other multiples: PEG 0.7, P/B 1.2, P/S 0.2, EV/EBITDA 9.1.
What is the PEG ratio of LAD?
The PEG ratio of Lithia Motors Inc is 0.74 (P/E divided by earnings growth, as of Sep 23, 2026). That is below 1, so growth is priced more cheaply than the earnings multiple alone suggests.
How solid is the balance sheet of Lithia Motors Inc (LAD)?
Balance-sheet figures for Lithia Motors Inc (as of Sep 23, 2026): return on equity 10.9%, debt of 1.46 per unit of equity. They feed the Quality Score of 44/100, which measures business quality independently of the share price.
How far is LAD from its 52-week high?
Lithia Motors Inc trades at $309.60, about 28% below its 52-week high of $427.48 and 28% above the low of $242.52 (as of Sep 24, 2026). Distance from the high says nothing about value: that is what the fair value of $498.50 is for.
Which stocks are comparable to Lithia Motors Inc?
From the same area (Consumer Cyclical) we also value Carvana Co, Penske Automotive Group, Hotai Motor Co, CarMax, Inc, among others. Each of them has its own fair-value calculation on this site using the same models, so the comparison is like for like.
Is Lithia Motors Inc stock attractive at the current price?
The data as of Sep 23, 2026: price $309.60, calculated fair value $498.50 (+61%), Quality Score 44/100, from 25 models. Whether that fits your horizon and risk tolerance is your call. We provide the calculation, not investment advice.
How is the fair value of LAD calculated?
We run Lithia Motors Inc through 25 models from four families: discounted cash flow, earnings models, asset and balance-sheet models, and dividend models. Every model gets the same audited fundamentals; the result is the weighted average of $498.50, with the spread shown as a cautious and an optimistic scenario.
Is it still worth investing in stocks now?
The global stock market currently sits 14.0 % above its aggregate fair value. Lithia Motors Inc currently trades 61 % below its own fair value, and the market average says nothing about that. An expensive market is no reason to stay out and no reason to buy everything at once: keep a broad savings plan running, buy single stocks only with money you can do without, and hold part of your money liquid while the market is high. The full picture including sectors is on is it worth investing now.
What is the share price of Lithia Motors Inc (LAD)?
The closing price on Sep 24, 2026 was $309.60. Our model-based fair value is $498.50, about +61% upside (undervalued). We carry closing prices from our data provider, not a live tick.
What should I pay attention to with Lithia Motors Inc right now?
The large discount to fair value meets weak quality (44/100). That raises the risk this is a value trap rather than a bargain. The model range is unusually wide ($259.50 to $1,022). The outcome hinges heavily on assumptions, so read the point estimate with caution.
Where does the earnings growth of Lithia Motors Inc (LAD) come from?
Earnings per share at Lithia Motors Inc grew +19.4 % a year from 2014 to 2025. Broken into its drivers: revenue per share +18.7 %, EBIT margin +1.3 %, tax rate +1.0 %, residual (interest, one-offs) −1.7 %. The four rates multiply to the earnings growth rate, they do not add up. Start and end are three-year averages so a single exceptional year does not distort the result.
Key figures of Lithia Motors Inc
How large is the market capitalisation of Lithia Motors Inc (LAD)?
The market capitalisation of Lithia Motors Inc is $7.9B. The stock-market value of the whole company: share price times number of shares. It is what the market asks for the entire business today.
What is the P/S ratio of Lithia Motors Inc (LAD)?
The price-to-sales ratio of Lithia Motors Inc is 0.23 (P/E × margin). Price to sales: market value relative to yearly revenue. Useful when profit is thin or distorted.
What are the earnings per share of Lithia Motors Inc (LAD)?
Earnings per share at Lithia Motors Inc are $29.34 (price ÷ EPS = P/E 10.6). Earnings per share over the last twelve months: total profit spread across every single share.
What is the dividend yield of Lithia Motors Inc (LAD)?
The dividend yield of Lithia Motors Inc is 0.7% (payout 7.6%). Yearly dividend relative to the share price. 3% pays 3 per 100 invested. Below: how much of profit is used for it.
What is the net margin of Lithia Motors Inc (LAD)?
The net margin of Lithia Motors Inc is 2.2% (fiscal year 2025). How much of every unit of revenue ends up as profit. 10% means 10 cents of profit per dollar of sales.
What is the return on equity of Lithia Motors Inc (LAD)?
The return on equity (ROE) of Lithia Motors Inc is 10.9% (last twelve months). Profit relative to shareholders' equity, how efficiently the company works with its owners' money.
What is the EBIT return on assets of Lithia Motors Inc (LAD)?
On an EBIT basis the return on assets of Lithia Motors Inc is 9.8% (avg 5y). Operating profit (EBIT) relative to everything the company owns, as a multi-year average. It describes the business model rather than one good or bad year.
What is the operating margin of Lithia Motors Inc (LAD)?
The operating margin of Lithia Motors Inc is 3.6% (last twelve months). Profit from the core business (before interest and taxes) relative to revenue.
How fast is revenue growing at Lithia Motors Inc (LAD)?
Revenue at Lithia Motors Inc is growing +1.0% versus a year earlier (3y avg +10.1%). How much revenue grew versus a year earlier (YoY). The 3-year average next to it puts the single year in context.
How fast are earnings growing at Lithia Motors Inc (LAD)?
Earnings per share at Lithia Motors Inc are growing −46.1% versus a year earlier. How much earnings per share grew versus a year earlier.
How much net debt does Lithia Motors Inc (LAD) carry?
The net debt of Lithia Motors Inc is $14.3B (fiscal year 2025, ≈ 74.8 yrs of FCF). Debt minus cash on hand. The note shows how many years of free cash flow could in theory pay it off.
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Broad data
Sep 23, 2026