In a report released yesterday, Michael Albanese from Benchmark Co. maintained a Buy rating on Lithia Motors (LAD – Research Report), with a price target of $400.00.
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Michael Albanese has given his Buy rating due to a combination of factors that suggest potential growth and profitability for Lithia Motors. Despite a recent decline in stock performance, the company has shown resilience with its strong March sales figures, indicating a possible rebound in demand. Additionally, the planned cost savings initiatives are expected to significantly reduce expenses, which could enhance profitability.
Furthermore, the Driveway Finance segment has reached profitability and is poised for further growth, aiming for increased market penetration. The company’s focus on aftersales presents an opportunity for margin improvement, while its inventory levels remain manageable. With a forward AEBITDA valuation that is competitive within its peer group, Lithia Motors is positioned to achieve its ambitious sales and earnings targets in the mid to long term.
LAD’s price has also changed slightly for the past six months – from $306.510 to $283.820, which is a -7.40% drop .