Lithia Motors offers compelling headline valuation—a PEG of 0.69 and a forward earnings multiple near 7.6 times—backed by three beats in the last four quarters; however, below-floor business quality with a Piotroski F-Score of 2 out of 9, 18% short interest, and an asymmetry ratio of only 0.5-to-1 collectively place this name in the avoid category despite the surface-level cheapness.
Thesis pillars
- Below Floor Business Quality→Stable
- Cheap Valuation Earnings Support→Stable
- High Short Interest Overhang→Stable
- +1 more pillar — see the Why tab for full reasoning
Lithia Motors, Inc. (LAD) Stock Analysis
Catalyst-Driven edge
Consumer Cyclical · Auto & Truck Dealerships
Sell if holding. Engine safety override at $306.23: Quality below floor (2.7 < 4.0) triggers a hard block regardless of the otherwise-positive setup — overall score 4.6/10. Specifically: High short interest: 18%; Below-average business quality; Negative price momentum.
Lithia and Driveway operated 455 automotive retail locations across 54 brands in the United States, United Kingdom, and Canada at December 31, 2025, selling new and used vehicles, financing and insurance products, and repair services through both physical dealerships and the... Read more
Sell if holding. Engine safety override at $306.23: Quality below floor (2.7 < 4.0) triggers a hard block regardless of the otherwise-positive setup — overall score 4.6/10. Specifically: High short interest: 18%; Below-average business quality; Negative price momentum. Chart setup: No clear chart pattern; technical signals are mixed. Score 4.6/10, moderate confidence.
Passes 6/9 gates (clean insider activity, no SEC red flags, news events none recent, earnings proximity 26d clear, semi cycle peak clear, materials cycle peak clear). Fails on weak momentum and favorable risk/reward ratio and death cross (50MA < 200MA). Suitability: moderate.
Recent developments
updated 2026-07-06Recent Developments — Lithia Motors, Inc.
Latest news
- NEWS UBS Initiates Coverage On Lithia Motors with Buy Rating, Announces Price Target of $348 — benzinga May 27, 2026 positive
- NEWS Lithia Expands Stock Repurchase Plan With Additional $500M Authorization — benzinga May 26, 2026 positive
- NEWS JP Morgan Maintains Neutral on Lithia Motors, Raises Price Target to $325 — benzinga May 7, 2026 neutral
- NEWS Citigroup Maintains Buy on Lithia Motors, Raises Price Target to $365 — benzinga May 1, 2026 positive
- NEWS Wells Fargo Maintains Equal-Weight on Lithia Motors, Raises Price Target to $305 — benzinga Apr 30, 2026 positive
Generated 2026-07-06T05:40:27Z.
Upcoming dated catalysts
Thesis
Key Metrics
Quality Signals
Options Flow
Concentration Risks(10-K Item 1A)
- MEDIUMSupplierHonda, Toyota, Ford, BMW, and Stellantis25%10-K Item 1A: 'New vehicles from five manufacturers, Honda, Toyota, Ford, BMW, and Stellantis, represent 25% of our sales.'
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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Rating Breakdown
3 floor-breakers
Growth below the gate floor. Component breakdown shows what dragged the score down.static
Quality below the gate floor. Component breakdown shows what dragged the score down.static
Momentum below the gate floor. Component breakdown shows what dragged the score down.static
Price Targets
Position Sizing
Risk Alerts
Earnings
Verdict History
Frequently Asked Questions
Sell if holding. Engine safety override at $306.23: Quality below floor (2.7 < 4.0) triggers a hard block regardless of the otherwise-positive setup — overall score 4.6/10. Specifically: High short interest: 18%; Below-average business quality; Negative price momentum. Chart setup: No clear chart pattern; technical signals are mixed. Prior stop was $285.81. Score 4.6/10, moderate confidence.
Take-profit target: $333.23 (+8.8% upside). Prior stop was $285.81. Stop-loss: $285.81.
Quality below floor (2.7 < 4.0).
Lithia Motors, Inc. trades at a P/E of 10.7 (forward 7.5). TrendMatrix value score: 8.1/10. Verdict: Sell.
21 analysts cover LAD with a consensus score of 4.1/5. Average price target: $370.
What does Lithia Motors, Inc. do?Lithia and Driveway operated 455 automotive retail locations across 54 brands in the United States, United Kingdom, and...
Lithia and Driveway operated 455 automotive retail locations across 54 brands in the United States, United Kingdom, and Canada at December 31, 2025, selling new and used vehicles, financing and insurance products, and repair services through both physical dealerships and the Driveway.com e-commerce platform. The company targets acquisition multiples of 3x-6x EBITDA, averaging over 25% returns by the third year of ownership.