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Lithia (LAD) Acquires 3 Hyundai Dealerships in Las Vegas

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Lithia Motors (LAD - Free Report) recently forayed into the Las Vegas market with the acquisition of three Hyundai dealerships. The buyout is expected to add $225 million in the firm’s annualized revenues.

Lithia is one of the leading automotive retailers of new and used vehicles along with related services in the United States. It offers tailored services complemented through its nationwide network. The auto retailer continuously strives to make acquisitions for increasing market share and catering to customer requirements in a better way. 

The spree of buyouts like John Eagle dealerships, Keyes Automotive dealerships and others brought the company's network expansion to more than $3.5 billion in revenues in 2020. In 2021, Lithia acquired dealerships from Fields Auto Group, Fink Auto Group, Avondale Nissan and Honda to expand footprint. Last month, Lithia announced the buyout of Suburban Collection, which is expected to add $2.4 billion in the firm’s annualized revenues. 

Last year, Lithia announced a five-year plan to yield $50 billion in revenues and $50 in earnings per share. Since the plan’s roll-out in July 2020, the auto retailer has achieved more than $6.9 billion in total annualized revenues. With the company having raised around $2 billion of additional capital through equity and debt offerings this month, it is all the more optimistic of achieving the five-year plan.

Lithia — which shares space with Sonic Automotive (SAH - Free Report) , AutoNation (AN - Free Report) and Penske Automotive (PAG - Free Report) — has been accelerating its pace of buyouts as it looks to level up inventory levels in the face of increasing vehicle demand. Acquisition of dealerships adds to Lithia’s inventory for Driveway — the e-commerce platform launched by the firm last year. Driveway currently offers a wide selection of new and used vehicles, and is the largest negotiation-free inventory selection of any retailer in the nation. Lithia, which currently carries a Zacks Rank #3 (Hold), targets to achieve a run rate of 15,000 Driveway shop and sell transactions by 2021-end. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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