| Factor | Score | Distribution | Value | Avg | Rank |
|---|---|---|---|---|---|
Valuation | 83 | 8.3x | 17.3x | Top tier | |
Growth | 39 | 1.6% | 7.1% | Bottom tier | |
Quality | 42 | 5.6% | 4.5% | Around median | |
Safety | 26 | 8.2x | 2.6x | Bottom tier | |
Capital Return | 78 | 0.81% | 0.06% | Top tier | |
Momentum | 54 | 1.2% | -1.6% | Around median | |
Sentiment | 43 | 9 | 3 | Around median |
10-year US Treasury yield 4.96% as of 2026-10-22. Estimates computed from company data and analyst targets, not investment advice.
Ten ratios that matter, each compared against its sector median and average — so you can see whether a number is rich or cheap relative to peers in the same sector.
Lithia Motors & Driveway operates in the sale of new and used vehicles, after-sales services, and financing, connecting these activities through an ecosystem that includes Lithia, Driveway, GreenCars, Driveway Finance Corporation, and MyDriveway. Economic revenue is not limited to the vehicle sale; the company generates income from financing, insurance and finance products, maintenance services, and parts, then benefits when the vehicle returns as a trade-in or used inventory. In Q2 FY2026, after-sales services were the largest contributor to gross profit at 42.2%, while DFC's managed portfolio exceeded $5 billion.
In Q2 FY2026, the company reported revenue of $9.8 billion, gross profit of $1.5 billion, and net income of $260.0 million, with reported diluted EPS of $11.54 and adjusted diluted EPS of $10.03, up 9% from the comparable period. Adjusted EBITDA was $445 million, down 2% year over year, and adjusted cash flow from operations was $228 million, up 76%. On a trailing 12-month basis through 2026, revenue reached $37.9 billion, gross profit reached $5.8 billion, and net income reached $714.4 million.
The earnings mix showed divergent trends across business lines in Q2 FY2026: same-store revenue declined 1.6% and total gross profit fell 2.7%, but used-vehicle gross profit increased 1.2% and after-sales services gross profit rose 3.1%. The after-sales services margin reached 59.2% following an expansion of 120 basis points, while used-vehicle gross profit per unit reached $2,019 after a sequential improvement of $339, and new-vehicle gross profit per unit remained stable at approximately $2,718 for the third consecutive quarter.
The average analyst price target is $409.29, within a wide range of $306 to $490, and the stock carries a consensus Buy rating; the average is below the 52-week range high of $439.49, while the highest target exceeds that high and the lowest target remains within the annual range of $239.78–439.49. No displayed P/E ratio is available in the provided data, so the assessment of the case rests on the breadth of the target range and the company's ability to translate expense reductions and DFC growth into earnings, weighed against the decline in same-store revenue and gross profit in Q2 FY2026.
Figures in the text are as of 2026-08-30; the live price is shown at the top of the page.
Revenue reached $9.8 billion, gross profit was $1.5 billion, and net income was $260.0 million. Reported diluted EPS was $11.54, while adjusted diluted EPS reached $10.03, up 9% from the comparable period. In contrast, same-store revenue declined 1.6% and total gross profit fell 2.7%, showing that earnings improvement came to a significant degree from mix, margins, and cost reductions.
DFC recorded financing operations income of $37 million in Q2 FY2026, with record originations of $884 million. Net interest margin increased 20 basis points to 4.8%, the managed portfolio exceeded $5 billion, and North American penetration reached 18%. The company targets penetration above 20%, but explained that seasonality and upfront CECL reserves could temporarily pressure earnings when accelerating portfolio growth.
Pinewood.AI solutions contributed approximately half of the 200-basis-point improvement in the expense-to-gross-profit ratio in the United Kingdom during Q2 FY2026. Management estimated the United Kingdom efficiency opportunity at approximately 447 thousand hours annually, equivalent to around $10–11 million, with approximately 80% of the measured work related to service. The company plans to begin deploying the platform in North America during the second half of FY2026, targeting a reduction of between 20% and 50% in the total cost of its technology and vendor package after the overlap periods end.
Automated analysis for informational purposes only — not investment advice.
Used-vehicle gross profit per unit reached $2,019 in Q2 FY2026, a sequential increase of $339, while the segment's gross profit rose 1.2%. Management attributes this improvement to balancing volume and margin and to dynamic pricing that combines AI tools with store teams' decisions. Certified used vehicles also exceeded 40% of the mix, while management sees an additional opportunity in value vehicles that were still being sold at approximately 10% below market, according to its estimate on the July 29, 2026 call.
After-sales services represented 42.2% of gross profit in Q2 FY2026, making them the company's largest business line. Gross profit grew 3.1% as margin expanded 120 basis points to 59.2%, while customer-pay gross profit increased 2.6% and warranty gross profit rose 5.4%. Management believes longer warranty periods and the higher mix of electrified vehicles, which approached 55% of new-vehicle sales, including 46.5% hybrids, may support service demand, while the risk of losing customers after warranties expire remains.
The company repurchased $242 million of shares in Q2 FY2026, reducing shares outstanding by approximately 4% during the quarter and by 17% compared with the prior year. It also increased the cash dividend by 23% to $0.70 per share, and total repurchases and dividends exceeded $560 million during the first half. At the same time, it acquired businesses representing $765 million in revenue and divested underperforming businesses representing $120 million in revenue, using a targeted purchase range equal to 15%–30% of revenue or 3–6 times adjusted EBITDA.