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Lithia's (LAD) Q4 Earnings Miss Estimates, Fall 20% Y/Y
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Lithia Motors (LAD - Free Report) reported fourth-quarter 2022 adjusted earnings of $9.05 per share, which decreased from the prior-year quarter’s $11.39. The bottom line also missed the Zacks Consensus Estimate of $10.11 per share. Lower-than-expected revenues from used vehicle retail and F&I segments resulted in the downslide. Total revenues jumped 10.8% year over year to $6,990.2 million. The top line also topped the Zacks Consensus Estimate of $6,893 million.
Lithia Motors, Inc. Price, Consensus and EPS Surprise
New vehicle retail revenues increased 10.6% year over year to $3,275.1 million and surpassed the Zacks Consensus Estimate of $3,228 million. The new vehicle units sold rose 5.2% from the prior-year quarter to 68,159 units and beat the consensus metric of 67,892 units. The average selling price of new-vehicle retail rose to $48,051 from $45,671 in the prior quarter and beat the consensus mark of $46,399. However, the gross margin in the segment decreased 240 basis points (bps) to 11.1% amid high cost of sales, which flared up 13.7% year over year.
Used-vehicle retail revenues climbed 10.4% year over year to $2,229.5 million but fell short of the Zacks Consensus Estimate of $2,243 million. The used-vehicle retail units sold grew 8.5% from the year-ago quarter to 75,834 units and missed the consensus metric of 79,486 units. The average selling price of used-vehicle retail was $29,399, increasing 1.8% year over year and beating the consensus mark of $28,729. The gross margin in the segment came down 390 bps to 7.3%. Revenues from used-vehicle wholesale inched down 2.2% to $336 million but outpaced the consensus mark of $319 million.
Revenues from service, body and parts were up 17.9% from the prior-year period to $716.2 million and crossed the Zacks Consensus Estimate of $711 million. The gross margin in the segment increased 260 bps to 53.9%. The company’s F&I business revenues grew 7.7% to $308.4 million but the figure missed the consensus estimate of $327 million. Revenues from fleet and others were $125 million, up 34% year over year and exceeded the consensus mark of $105 million.
While same-store new-vehicle revenues fell 0.9% year over year, the same-store used-vehicle retail sales increased 2%. The same-store revenues from the F&I business dipped 3.4%, and that of the service, body and parts unit grew 8.5%.
Financial Tidbits
Cost of sales jumped 14.1% year over year in fourth-quarter 2022. SG&A expenses were $753.4 million, increasing 6.8% from $705.7 million in the year-ago quarter. Adjusted SG&A as a percentage of gross profit was 62.8%. Pretax and net profit margins declined from the year-ago levels.
The company approved a dividend of 42 cents per share, which is to be paid on Mar 24, 2032, to shareholders of record on Mar 10, 2023.
During the quarter under review, Lithia bought back 174,000 shares at an average price of $198. In 2022, it repurchased 2.4 million shares at a weighted average price of roughly $276. Under the current share repurchase authorization, approximately $501 million remains available.
Lithia had cash/cash equivalents/restricted cash of $246.7 million as of Dec 31, 2022, up from $174.8 million as of Dec 31, 2021. Long-term debt was $5,088.3 million as of 2022-end, marking an increase from $2,868.1 million as of Dec 31, 2021.
Group 1 Automotive (GPI - Free Report) reported fourth-quarter 2022 adjusted earnings per share of $10.86, beating the Zacks Consensus Estimate of $10.51. The outperformance can be attributed to higher-than-anticipated gross profit from the company’s New-vehicle retail and Parts/Service segments. The bottom line increased 15.1% from the prior-year quarter’s $9.43 per share. The company registered net sales of $4,069 million, beating the Zacks Consensus Estimate of $3,872 million. Also, the top line rose 16.6% from the year-ago quarter’s $3,489.6 million.
Selling, general and administrative expenses were up 7.8% year over year to $453.8 million. Group 1 had cash and cash equivalents of $47.9 million as of Dec 31, 2022, up from $14.9 million as of 2021-end. Total debt was $2,082.5 million as of Dec 31, 2022, up from $2,035.7 million recorded on Dec 31, 2021. During the quarter under review, GPI repurchased 973,365 shares at an average price of $166.14 per common share for a total of $161.7 million. As of Dec 31, 2022, the company had 14.3 million common shares outstanding. (Group 1 Q4 Earnings Surpass Estimates, Rise 15% Y/Y)
Asbury Automotive (ABG - Free Report) reported impressive fourth-quarter 2022 adjusted earnings of $9.12 per share, which increased 22.2% year over year and topped the Zacks Consensus Estimate of $8.23 per share. This outperformance can be primarily attributed to higher-than-expected gross profit from the new vehicle and finance & insurance units. In the reported quarter, revenues amounted to $3.7 billion, surging 40% year over year. The top line, however, fell short of the Zacks Consensus Estimate of $3.8 billion.
As of Dec 31, 2022, the company had cash and cash equivalents of $235.3 million, up from $178.9 million on Dec 31, 2021. It had long-term debt of $3,301.2 million as of Dec 31, 2022, down from $3,582.6 million on Dec 31, 2021. During 2022, Asbury repurchased approximately 1.6 million shares for nearly $300 million. During the last reported quarter, the company adopted a Rule 10b5-1 trading plan, effective for trading Dec 19, 2022, through Feb 1, 2023. From Oct 1, 2022 through Feb 1, 2023, the company repurchased around 600,000 shares for $108 million. On Jan 26, 2023, Asbury boosted its share repurchase authorization to $200 million. As of Feb 1, the company had $200 million share repurchase authorization remaining. (Asbury Q4 Earnings Outstrip Estimates, Jump 22.2% Y/Y)
Penske Automotive Group (PAG - Free Report) reported fourth-quarter 2022 adjusted earnings of $4.21 per share, which increased from $4.10 and surpassed the Zacks Consensus Estimate of $4.03. Higher-than-expected revenues in the Retail Automotive and Retail Commercial Truck segments resulted in this outperformance. The auto retailer registered net sales of $7,012 million, which topped the Zacks Consensus Estimate of $6,378 million. The top line rose 11.4% from the year-ago quarter.
In the quarter under review, SG&A costs totaled $815.5 million, up 3.1% year over year. Penske had cash and cash equivalents of $106.5 million as of Dec 31, 2022, up from $100.7 million in 2021 end. Penske’s gross profit in the reported quarter increased 0.3% on a year-over-year basis to $1,183.2 million. The operating income went down 5.8% to $335.5 million. The long-term debt was $1,546.9 million, up from $1,392 million as of Dec 31, 2021. In 2022, PAG repurchased 8.2 million shares of common stock for $886.5 million. The company also hiked its payout by 7% to 61 cents a share. (Penske Surpasses Q4 Earnings and Sales Estimates)
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Lithia's (LAD) Q4 Earnings Miss Estimates, Fall 20% Y/Y
Lithia Motors (LAD - Free Report) reported fourth-quarter 2022 adjusted earnings of $9.05 per share, which decreased from the prior-year quarter’s $11.39. The bottom line also missed the Zacks Consensus Estimate of $10.11 per share. Lower-than-expected revenues from used vehicle retail and F&I segments resulted in the downslide. Total revenues jumped 10.8% year over year to $6,990.2 million. The top line also topped the Zacks Consensus Estimate of $6,893 million.
Lithia Motors, Inc. Price, Consensus and EPS Surprise
Lithia Motors, Inc. price-consensus-eps-surprise-chart | Lithia Motors, Inc. Quote
Segmental Performance
New vehicle retail revenues increased 10.6% year over year to $3,275.1 million and surpassed the Zacks Consensus Estimate of $3,228 million. The new vehicle units sold rose 5.2% from the prior-year quarter to 68,159 units and beat the consensus metric of 67,892 units. The average selling price of new-vehicle retail rose to $48,051 from $45,671 in the prior quarter and beat the consensus mark of $46,399. However, the gross margin in the segment decreased 240 basis points (bps) to 11.1% amid high cost of sales, which flared up 13.7% year over year.
Used-vehicle retail revenues climbed 10.4% year over year to $2,229.5 million but fell short of the Zacks Consensus Estimate of $2,243 million. The used-vehicle retail units sold grew 8.5% from the year-ago quarter to 75,834 units and missed the consensus metric of 79,486 units. The average selling price of used-vehicle retail was $29,399, increasing 1.8% year over year and beating the consensus mark of $28,729. The gross margin in the segment came down 390 bps to 7.3%. Revenues from used-vehicle wholesale inched down 2.2% to $336 million but outpaced the consensus mark of $319 million.
Revenues from service, body and parts were up 17.9% from the prior-year period to $716.2 million and crossed the Zacks Consensus Estimate of $711 million. The gross margin in the segment increased 260 bps to 53.9%. The company’s F&I business revenues grew 7.7% to $308.4 million but the figure missed the consensus estimate of $327 million. Revenues from fleet and others were $125 million, up 34% year over year and exceeded the consensus mark of $105 million.
While same-store new-vehicle revenues fell 0.9% year over year, the same-store used-vehicle retail sales increased 2%. The same-store revenues from the F&I business dipped 3.4%, and that of the service, body and parts unit grew 8.5%.
Financial Tidbits
Cost of sales jumped 14.1% year over year in fourth-quarter 2022. SG&A expenses were $753.4 million, increasing 6.8% from $705.7 million in the year-ago quarter. Adjusted SG&A as a percentage of gross profit was 62.8%. Pretax and net profit margins declined from the year-ago levels.
The company approved a dividend of 42 cents per share, which is to be paid on Mar 24, 2032, to shareholders of record on Mar 10, 2023.
During the quarter under review, Lithia bought back 174,000 shares at an average price of $198. In 2022, it repurchased 2.4 million shares at a weighted average price of roughly $276. Under the current share repurchase authorization, approximately $501 million remains available.
Lithia had cash/cash equivalents/restricted cash of $246.7 million as of Dec 31, 2022, up from $174.8 million as of Dec 31, 2021. Long-term debt was $5,088.3 million as of 2022-end, marking an increase from $2,868.1 million as of Dec 31, 2021.
Lithia currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks Rank #1 (Strong) stocks here.
Peer Releases
Group 1 Automotive (GPI - Free Report) reported fourth-quarter 2022 adjusted earnings per share of $10.86, beating the Zacks Consensus Estimate of $10.51. The outperformance can be attributed to higher-than-anticipated gross profit from the company’s New-vehicle retail and Parts/Service segments. The bottom line increased 15.1% from the prior-year quarter’s $9.43 per share. The company registered net sales of $4,069 million, beating the Zacks Consensus Estimate of $3,872 million. Also, the top line rose 16.6% from the year-ago quarter’s $3,489.6 million.
Selling, general and administrative expenses were up 7.8% year over year to $453.8 million. Group 1 had cash and cash equivalents of $47.9 million as of Dec 31, 2022, up from $14.9 million as of 2021-end. Total debt was $2,082.5 million as of Dec 31, 2022, up from $2,035.7 million recorded on Dec 31, 2021. During the quarter under review, GPI repurchased 973,365 shares at an average price of $166.14 per common share for a total of $161.7 million. As of Dec 31, 2022, the company had 14.3 million common shares outstanding. (Group 1 Q4 Earnings Surpass Estimates, Rise 15% Y/Y)
Asbury Automotive (ABG - Free Report) reported impressive fourth-quarter 2022 adjusted earnings of $9.12 per share, which increased 22.2% year over year and topped the Zacks Consensus Estimate of $8.23 per share. This outperformance can be primarily attributed to higher-than-expected gross profit from the new vehicle and finance & insurance units. In the reported quarter, revenues amounted to $3.7 billion, surging 40% year over year. The top line, however, fell short of the Zacks Consensus Estimate of $3.8 billion.
As of Dec 31, 2022, the company had cash and cash equivalents of $235.3 million, up from $178.9 million on Dec 31, 2021. It had long-term debt of $3,301.2 million as of Dec 31, 2022, down from $3,582.6 million on Dec 31, 2021. During 2022, Asbury repurchased approximately 1.6 million shares for nearly $300 million. During the last reported quarter, the company adopted a Rule 10b5-1 trading plan, effective for trading Dec 19, 2022, through Feb 1, 2023. From Oct 1, 2022 through Feb 1, 2023, the company repurchased around 600,000 shares for $108 million. On Jan 26, 2023, Asbury boosted its share repurchase authorization to $200 million. As of Feb 1, the company had $200 million share repurchase authorization remaining. (Asbury Q4 Earnings Outstrip Estimates, Jump 22.2% Y/Y)
Penske Automotive Group (PAG - Free Report) reported fourth-quarter 2022 adjusted earnings of $4.21 per share, which increased from $4.10 and surpassed the Zacks Consensus Estimate of $4.03. Higher-than-expected revenues in the Retail Automotive and Retail Commercial Truck segments resulted in this outperformance. The auto retailer registered net sales of $7,012 million, which topped the Zacks Consensus Estimate of $6,378 million. The top line rose 11.4% from the year-ago quarter.
In the quarter under review, SG&A costs totaled $815.5 million, up 3.1% year over year. Penske had cash and cash equivalents of $106.5 million as of Dec 31, 2022, up from $100.7 million in 2021 end. Penske’s gross profit in the reported quarter increased 0.3% on a year-over-year basis to $1,183.2 million. The operating income went down 5.8% to $335.5 million. The long-term debt was $1,546.9 million, up from $1,392 million as of Dec 31, 2021. In 2022, PAG repurchased 8.2 million shares of common stock for $886.5 million. The company also hiked its payout by 7% to 61 cents a share. (Penske Surpasses Q4 Earnings and Sales Estimates)