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Lithia's (LAD) Q2 Earnings & Sales Lag Estimates, Increase Y/Y
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Lithia Motors (LAD - Free Report) reported second-quarter 2022 adjusted earnings of $12.18 per share, marking an increase from the prior-year quarter’s $11.12 per share. However, the bottom line missed the Zacks Consensus Estimate of $12.22. Lower-than-expected revenues from new vehicle, used-vehicle wholesale and F&I segments led to the downslide.
Total revenues jumped 20.5% year over year to $7,240 million. The top line however missed the Zacks Consensus Estimate of $7,511 million.
Segmental Performance
New vehicle retail revenues increased 3.3% year over year to $3,250.7 million but missed the Zacks Consensus Estimate of $3,537 million. New vehicle units sold dropped 8.5% from the prior-year quarter to 68,752 units. The average selling price of new-vehicle retail rose to $47,281 from $41,852 in the prior quarter.
The used-vehicle retail revenues surged 39% year over year to $2,509.9 million and topped the Zacks Consensus Estimate of $2,392 million. The used-vehicle retail units sold grew 15.3% from the year-ago quarter to 81,026 units. The average selling price of used-vehicle retail was $30,976, increasing from $25,691. Revenues from used-vehicle wholesale jumped 69.8% to $369.2 million but missed the consensus mark of $375 million.
Revenues from service, body and parts were up 31% from the prior-year period to $682.6 million and crossed the Zacks Consensus Estimate of $637 million. The company’s F&I business revenues grew 22.6% to $330.4 million. The figure missed the consensus estimate of $358 million. Revenues from fleet and others were $97.3 million, surging 93.4% year over year and exceeding the consensus mark of $69 million.
While the same-store new-vehicle revenues fell 16.9% year over year, the same-store used-vehicle retail sales increased 17.5%. The same-store revenues from the F&I business inched down 1.6%, and that of the service, body and parts unit grew 9.4%.
Financial Tidbits
Cost of sales jumped 20.2% year over year in second-quarter 2022. SG&A expenses came in at $781.5 million, increasing from $634 million in the year-ago quarter. Adjusted SG&A as a percentage of gross profit was 58%. Pretax and net profit margins declined from the year-ago levels.
The company approved a dividend of 42 cents per share related to second-quarter 2022 financial results. The dividend is to be paid on Aug 26, 2022, to shareholders of record on Aug 12, 2022.
In 2022, LAD repurchased 2.1 million shares at a weighted average price of $284.58. Under the current share repurchase authorization, approximately $114 million remains available.
Lithia had cash and cash equivalents of $113.2 million as of Jun 30, 2022, down from $174.8 million as of Dec 31, 2021. Long-term debt was $4,721.7 million, marking an increase from $3,185.7 million as of Dec 31, 2021.
BRP Group has an expected earnings growth rate of 11.4% for the current year. The Zacks Consensus Estimate for current-year earnings has been kept constant in the past 30 days.
BRP Group’s earnings beat the Zacks Consensus Estimate in all the trailing four quarters. DOOO pulled off a trailing four-quarter earnings surprise of 56.81%, on average. The stock has declined 12.8% over the past year.
American Axle has an expected earnings growth rate of 93.9% for 2023. The Zacks Consensus Estimate for current-year earnings has been revised 1.2% in the past 30 days.
American Axle’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters and missed in one. AXL pulled off a trailing four-quarter earnings surprise of 847.92%, on average. The stock has declined 8.8% in the past year.
Standard Motor has an expected earnings growth rate of 5.2% for the current year. The Zacks Consensus Estimate for current-year earnings has remained constant in the past 30 days.
Standard Motor’s earnings beat the Zacks Consensus Estimate in all the trailing four quarters. SMP pulled off a trailing four-quarter earnings surprise of 40.34%, on average. The stock has risen 11.6% over the past year.
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Lithia's (LAD) Q2 Earnings & Sales Lag Estimates, Increase Y/Y
Lithia Motors (LAD - Free Report) reported second-quarter 2022 adjusted earnings of $12.18 per share, marking an increase from the prior-year quarter’s $11.12 per share. However, the bottom line missed the Zacks Consensus Estimate of $12.22. Lower-than-expected revenues from new vehicle, used-vehicle wholesale and F&I segments led to the downslide.
Total revenues jumped 20.5% year over year to $7,240 million. The top line however missed the Zacks Consensus Estimate of $7,511 million.
Segmental Performance
New vehicle retail revenues increased 3.3% year over year to $3,250.7 million but missed the Zacks Consensus Estimate of $3,537 million. New vehicle units sold dropped 8.5% from the prior-year quarter to 68,752 units. The average selling price of new-vehicle retail rose to $47,281 from $41,852 in the prior quarter.
The used-vehicle retail revenues surged 39% year over year to $2,509.9 million and topped the Zacks Consensus Estimate of $2,392 million. The used-vehicle retail units sold grew 15.3% from the year-ago quarter to 81,026 units. The average selling price of used-vehicle retail was $30,976, increasing from $25,691. Revenues from used-vehicle wholesale jumped 69.8% to $369.2 million but missed the consensus mark of $375 million.
Revenues from service, body and parts were up 31% from the prior-year period to $682.6 million and crossed the Zacks Consensus Estimate of $637 million. The company’s F&I business revenues grew 22.6% to $330.4 million. The figure missed the consensus estimate of $358 million. Revenues from fleet and others were $97.3 million, surging 93.4% year over year and exceeding the consensus mark of $69 million.
While the same-store new-vehicle revenues fell 16.9% year over year, the same-store used-vehicle retail sales increased 17.5%. The same-store revenues from the F&I business inched down 1.6%, and that of the service, body and parts unit grew 9.4%.
Financial Tidbits
Cost of sales jumped 20.2% year over year in second-quarter 2022. SG&A expenses came in at $781.5 million, increasing from $634 million in the year-ago quarter. Adjusted SG&A as a percentage of gross profit was 58%. Pretax and net profit margins declined from the year-ago levels.
The company approved a dividend of 42 cents per share related to second-quarter 2022 financial results. The dividend is to be paid on Aug 26, 2022, to shareholders of record on Aug 12, 2022.
In 2022, LAD repurchased 2.1 million shares at a weighted average price of $284.58. Under the current share repurchase authorization, approximately $114 million remains available.
Lithia had cash and cash equivalents of $113.2 million as of Jun 30, 2022, down from $174.8 million as of Dec 31, 2021. Long-term debt was $4,721.7 million, marking an increase from $3,185.7 million as of Dec 31, 2021.
Zacks Rank & Other Key Picks
LAD carries a Zacks Rank #2 (Buy), currently.
Other top-ranked players in the auto space include BRP Group, Inc. (DOOO - Free Report) , American Axle & Manufacturing Holdings (AXL - Free Report) and Standard Motor Products (SMP - Free Report) , each carrying a Zacks Rank #2, currently. You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
BRP Group has an expected earnings growth rate of 11.4% for the current year. The Zacks Consensus Estimate for current-year earnings has been kept constant in the past 30 days.
BRP Group’s earnings beat the Zacks Consensus Estimate in all the trailing four quarters. DOOO pulled off a trailing four-quarter earnings surprise of 56.81%, on average. The stock has declined 12.8% over the past year.
American Axle has an expected earnings growth rate of 93.9% for 2023. The Zacks Consensus Estimate for current-year earnings has been revised 1.2% in the past 30 days.
American Axle’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters and missed in one. AXL pulled off a trailing four-quarter earnings surprise of 847.92%, on average. The stock has declined 8.8% in the past year.
Standard Motor has an expected earnings growth rate of 5.2% for the current year. The Zacks Consensus Estimate for current-year earnings has remained constant in the past 30 days.
Standard Motor’s earnings beat the Zacks Consensus Estimate in all the trailing four quarters. SMP pulled off a trailing four-quarter earnings surprise of 40.34%, on average. The stock has risen 11.6% over the past year.