Core Insights - The article emphasizes the importance of utilizing Zacks Premium for investors to enhance their stock market strategies and confidence in investing [1][2] Zacks Style Scores - Zacks Style Scores are complementary indicators that rate stocks based on value, growth, and momentum methodologies, helping investors identify stocks likely to outperform the market in the next 30 days [3][4] - Each stock receives a rating from A to F based on its characteristics, with A being the highest score indicating a better chance of outperforming [4] Value Score - The Value Score identifies attractive and discounted stocks using ratios like P/E, PEG, Price/Sales, and Price/Cash Flow, appealing to value investors [4] Growth Score - The Growth Score focuses on a company's financial strength and future outlook, analyzing projected and historical earnings, sales, and cash flow to find stocks with sustainable growth [5] Momentum Score - The Momentum Score helps investors capitalize on price trends by analyzing short-term price changes and earnings estimate revisions [6] VGM Score - The VGM Score combines all three Style Scores, providing a comprehensive indicator for investors who utilize multiple investing strategies [7] Zacks Rank - The Zacks Rank is a proprietary stock-rating model that leverages earnings estimate revisions to assist investors in building successful portfolios [8] - Stocks rated 1 (Strong Buy) have historically produced an average annual return of +25.41% since 1988, significantly outperforming the S&P 500 [9] Stock Example: Lithia Motors - Lithia Motors, Inc. is a leading automotive retailer in the U.S., offering 52 vehicle brands across 459 locations in the U.S., U.K., and Canada [13] - Currently rated 3 (Hold) with a VGM Score of B, it has a Value Style Score of B, supported by a forward P/E ratio of 8.56, making it attractive to value investors [14] - Recent earnings estimates for fiscal 2025 have been revised higher, with the Zacks Consensus Estimate increasing by $0.06 to $34.51 per share, alongside an average earnings surprise of 2% [14]

Financial Performance - Lithia & Driveway reported record first quarter revenue of $9.2 billion, a 7% increase from $8.6 billion in Q1 2024[3]. - Diluted earnings per share increased by 35% to $7.94, up from $5.89 in the same period last year[4]. - Net income for Q1 2025 was $211 million, representing a 28% increase compared to $165 million in Q1 2024[5]. - Adjusted diluted earnings per share rose 25% to $7.66, compared to $6.11 in Q1 2024[4]. - New vehicle retail revenue increased by 5.7% to $4,166.6 million compared to $3,940.7 million in the same period last year[25]. - Total revenues rose by 2.5% to $8,543.2 million from $8,332.5 million year-over-year[25]. - Net income for the three months ended March 31, 2025, was $211.2 million, up from $165.0 million in the prior year[29]. - Adjusted EBITDA for Q1 2025 reached $402.1 million, representing a 17.1% increase from $343.5 million in Q1 2024[32]. Cash and Assets - Lithia & Driveway ended Q1 2025 with approximately $1.4 billion in cash and cash equivalents[12]. - Cash, restricted cash, and cash equivalents at the end of the period rose to $478.1 million from $440.5 million[29]. - Total assets increased to $23,480.2 million from $23,122.6 million as of December 31, 2024[28]. Debt and Financing - Total debt increased by 6.0% to $13,304.7 million as of March 31, 2025, compared to $12,553.1 million in the previous year[33]. - Net debt rose to $3,986.5 million, a 1.8% increase from $3,914.7 million in Q1 2024, with a net debt to adjusted EBITDA ratio of 2.47x compared to 2.31x in the prior year[33]. - The company reported a decrease in flooring interest expense to $57.1 million in Q1 2025 from $60.7 million in Q1 2024, showing improved financing conditions[32]. Operational Metrics - New retail units increased by 3.6% on a same-store basis compared to Q1 2024[11]. - Aftersales gross profit grew by 7.5% on a same-store basis compared to Q1 2024[11]. - Driveway Finance Corporation originated $623 million in loans, with a portfolio of $4.1 billion in average managed receivables[11]. - Days' supply for new vehicle inventory decreased to 43 days from 59 days year-over-year[26]. - Selling, general and administrative expenses for Q1 2025 were reported at $952.7 million, up from $934.3 million in Q1 2024[31]. - Operating income for Q1 2025 was $406.3 million, compared to $341.4 million in Q1 2024, reflecting a significant operational improvement[31]. Dividend and Shareholder Returns - The Board approved an increased dividend of $0.55 per share, a 4% increase from the previous dividend[13]. Future Outlook - Future outlook includes continued focus on market expansion and potential new product developments, although specific figures were not disclosed in the call[31].

Core Viewpoint - Lithia Motors reported quarterly earnings of $7.66 per share, missing the Zacks Consensus Estimate of $7.77 per share, but showing an increase from $6.11 per share a year ago, indicating a -1.42% earnings surprise [1] - The company posted revenues of $9.18 billion for the quarter, missing the Zacks Consensus Estimate by 1.09%, and up from $8.56 billion year-over-year [2] Group 1: Earnings Performance - Lithia Motors has surpassed consensus EPS estimates three times over the last four quarters [2] - The company had an earnings surprise of 11.13% in the previous quarter, where it reported earnings of $7.79 per share against an expectation of $7.01 per share [1] Group 2: Stock Performance - Lithia Motors shares have declined approximately 17.3% since the beginning of the year, compared to a decline of 10.1% for the S&P 500 [3] - The current Zacks Rank for Lithia Motors is 3 (Hold), indicating expected performance in line with the market in the near future [6] Group 3: Future Outlook - The current consensus EPS estimate for the upcoming quarter is $8.92 on revenues of $9.78 billion, and for the current fiscal year, it is $34.51 on revenues of $38.78 billion [7] - The outlook for the automotive retail and wholesale industry is positive, with the industry currently in the top 17% of Zacks-ranked industries, suggesting potential for outperformance [8] Group 4: Competitor Insights - Penske Automotive, another company in the same industry, is expected to report quarterly earnings of $3.27 per share, reflecting a year-over-year increase of 2.5% [9] - Penske Automotive's revenues are anticipated to be $7.54 billion, up 1.2% from the previous year [10]

Core Insights - Lithia & Driveway reported the highest first quarter revenue in company history, with a 7% increase to $9.2 billion compared to $8.6 billion in Q1 2024 [2][21] - Diluted earnings per share increased by 35% to $7.94 from $5.89 in the same period last year [3][23] - The company announced an increased dividend of $0.55 per share, a 4% increase, to be paid on May 23, 2025 [11] Financial Performance - First quarter 2025 net income was $211 million, a 28% increase from $165 million in Q1 2024 [4][22] - Adjusted net income for Q1 2025 was $204 million, a 20% increase compared to $171 million in Q1 2024 [4][38] - The company achieved a gross profit of $1.41 billion, reflecting a 5.6% increase from $1.34 billion in the previous year [21][22] Operational Highlights - The company acquired two stores in 2025, adding an expected annualized revenue of $180 million [8][9] - New retail units increased by 3.6% on a same-store basis compared to Q1 2024 [15] - Used retail unit growth improved from -4.3% to -0.4% on a sequential same-store basis [15] Balance Sheet and Cash Flow - Lithia & Driveway ended Q1 2025 with approximately $1.4 billion in cash and cash equivalents, along with marketable securities [10] - The company repurchased approximately 403,000 shares at a weighted average price of $326 during the first quarter [12] - Net cash provided by operating activities was $322.1 million, an increase from $294 million in Q1 2024 [35] Strategic Outlook - The company emphasized its integrated ecosystem and disciplined execution of strategy, focusing on profitable growth and market share expansion [7] - Lithia & Driveway aims to deliver consistent, high-quality experiences across all channels throughout 2025 and beyond [7]

Group 1 - Lithia & Driveway announced the transition of Adam Chamberlain from Executive Vice President and Chief Operating Officer to CEO of Mercedes-Benz USA effective June 1, 2025 [1] - Bryan DeBoer, President and CEO of Lithia & Driveway, expressed gratitude for Chamberlain's leadership and contributions, which strengthened operations and advanced the company's strategy [2] - The company emphasizes its mission of "Growth Powered by People," ensuring a strong leadership team with Regional Presidents and Vice Presidents reporting directly to the CEO [2] Group 2 - Lithia & Driveway is the largest global automotive retailer, offering a wide range of products and services throughout the vehicle ownership lifecycle [3] - The company aims to provide simple, convenient, and transparent experiences through a comprehensive network of physical locations and e-commerce platforms [3] - Lithia & Driveway focuses on consistent, profitable growth in a large and unconsolidated industry, leveraging its diversified and competitively differentiated design [3]

Group 1 - Lithia & Driveway (NYSE: LAD) will release its first quarter 2025 earnings on April 23, 2025, before the market opens [1] - A conference call to discuss the earnings results is scheduled for the same day at 10:00 a.m. Eastern Time [1] - The conference call can be accessed by telephone or via the company's website for live listening and replay [2] Group 2 - Lithia & Driveway is the largest global automotive retailer, offering a wide range of products and services throughout the vehicle ownership lifecycle [3] - The company emphasizes simple, convenient, and transparent experiences through its extensive network of physical locations and e-commerce platforms [3] - Lithia & Driveway aims for consistent, profitable growth in a large and unconsolidated industry, leveraging its diversified and competitively differentiated design [3]

Core Insights - The article discusses the journey to financial independence through disciplined living and strategic investing, highlighting the transition from financial struggle to freedom within a six-year period [2]. Group 1: Financial Independence Journey - The individual began blogging in 2011 about achieving financial independence by living below means and investing wisely [2]. - Achieved financial freedom at the age of 33 after starting from a position of being "below broke" at 27 [2]. Group 2: Investment Focus - The content created focuses on dividend growth investing, emphasizing the importance of living off dividends and identifying undervalued high-quality dividend growth stocks [2]. - The strategy includes exploring high-yield investment opportunities and other long-term investment prospects [2].

Core Viewpoint - Lithia Motors, Inc. is actively expanding its market presence through strategic acquisitions, enhancing its revenue and market share in the automotive sector [1][3]. Acquisition Details - Lithia Motors acquired Elk Grove Subaru in Elk Grove, CA, to strengthen its footprint in the Sacramento area and the Southwest region [1]. - The acquisition is projected to generate $100 million in annual revenues, increasing Lithia's total year-to-date acquired annualized revenues to $180 million [2]. - In 2023, Lithia acquired $3.8 billion in annualized revenues, and in 2024, it further acquired over $5.9 billion in annualized revenues through multiple dealership acquisitions [3]. Financial Strategy - Lithia's board approved a $350 million increase to its share repurchase authorization, raising the total available for future buybacks to approximately $748 million [4]. - As of March 4, 2025, Lithia has repurchased over $71 million worth of shares, representing 0.75% of outstanding shares at an average price of $361 per share [4]. Market Position - Lithia currently holds a Zacks Rank of 3 (Hold), indicating a stable position in the market [5]. - Comparatively, other auto stocks like Geely Automobile Holdings Limited, Dana Incorporated, and Strattec Security Corporation are rated higher with a Zacks Rank of 1 (Strong Buy) [5]. Growth Estimates - The Zacks Consensus Estimate for Geely's fiscal 2025 indicates significant year-over-year growth of 66.62% in sales and 149.31% in earnings [6]. - Dana's 2025 earnings are expected to grow by 70.21% year-over-year, with improved EPS estimates for the next two fiscal years [6]. - Strattec's 2025 sales are projected to grow by 2.61%, with positive revisions in EPS estimates for the upcoming years [7].

Core Points - Lithia & Driveway announced the acquisition of Elk Grove Subaru, enhancing its presence in the Sacramento area and the Southwest region [1][2] - The acquisition is expected to generate annual revenue of $100 million, contributing to a total of $180 million in year-to-date annualized revenue acquired [3] - The acquisition was financed using existing on-balance sheet capacity [3] Share Repurchase Authorization - Lithia & Driveway's Board of Directors approved a $350 million increase to its share repurchase authorization, raising total available funds for future repurchases to approximately $748 million [4] - The company has invested over $71 million this year to repurchase over 197,500 shares at a weighted average price of $361 per share, representing 0.75% of outstanding shares [4] Company Overview - Lithia & Driveway is the largest global automotive retailer, offering a wide range of products and services throughout the vehicle ownership lifecycle [5] - The company emphasizes simple, convenient, and transparent experiences through its network of physical locations and e-commerce platforms [5] - Lithia & Driveway aims for consistent, profitable growth in a large and unconsolidated industry, leveraging its diversified and competitively differentiated design [5]

Acquisition and Growth Strategy - Lithia and Driveway acquired 146 stores in 2024, investing $1.1 billion, which is expected to generate nearly $5.9 billion in annualized revenues[28] - Lithia and Driveway's acquisition strategy targets an annual after-tax return of over 15%, with an average return exceeding 25% by the third year of ownership[26] - The company allocated 35% to 45% of its free cash flow to acquisitions, 25% to capital expenditures, and 30% to shareholder returns in 2024[29] Financial Performance and Liquidity - As of December 31, 2024, Lithia and Driveway had available liquidity of approximately $1.4 billion, including $225.1 million in unrestricted cash and $1.1 billion in credit facilities[29] - The company had $8.7 billion in variable rate debt with a weighted average interest rate of 5.8% per annum as of December 31, 2024[268] - A 10% increase in interest rates would raise annual interest expense by approximately $37.9 million, net of tax, based on amounts outstanding as of December 31, 2024[268] - The fair value of long-term fixed interest rate debt was approximately $4.1 billion as of December 31, 2024, with $4.6 billion outstanding[271] - A 10% devaluation in average exchange rates would have resulted in a $798.5 million decrease in revenues for the year ended December 31, 2024[273] Operational Efficiency - The company achieved a 32.5% reduction in cost per order and a 96.3% decrease in cost per acquisition through operational efficiencies in 2024[35] - Total advertising expenses in 2024 were $250.7 million, with over 89% allocated to digital and social media[37] - The Driveway e-commerce platform had a significant impact, allowing customers to access a vast inventory and facilitating home delivery options[35] Market Presence and Competition - The company operates 459 locations across the U.S., U.K., and Canada, representing 52 brands, enhancing its market presence[17] - The company faces competition from retailers with similar or greater financial resources in existing markets[45] Workforce and Diversity - The company employed approximately 30,000 persons on a full-time equivalent basis across 459 retail locations as of December 31, 2024[54] - The workforce comprised approximately 22% female team members and 41% minorities, with management consisting of 23% females and 28% minorities in leadership positions[54] Marketing and Customer Loyalty - Lithia and Driveway's marketing strategy focuses on creating lifelong customer loyalty through transparent and convenient retail experiences[30] Regulatory Environment - The company operates in a highly regulated industry, requiring various licenses for dealer, sales, finance, and insurance[46] Seasonal Trends - The company’s North American operations typically experience lower volumes in the first quarter due to consumer purchasing patterns[58] Human Capital Strategy - The company emphasizes professional success and well-being of team members as part of its human capital strategy[53] Market Trends - GreenCars.com experienced a 48% increase in unique visitors in 2024, reaching approximately 11.2 million, highlighting the growing interest in sustainable vehicles[36]