Abstract
Lithia Motors will report fourth-quarter results on February 11, 2026, Pre-Market. This preview consolidates the latest financial forecast, last-quarter performance, and institutional commentary gathered through February 04, 2026, to frame expectations around revenue, margins, and adjusted EPS, and to highlight business drivers likely to move the stock.
Market Forecast
Consensus expectations for the current quarter indicate total revenue of $9.19 billion, with forecast year-over-year growth of 0.97%, alongside estimated adjusted EPS of $8.11, up 12.10% year-over-year, and forecast EBIT of $0.39 billion, down 1.38% year-over-year. There is no explicit gross profit margin or net profit margin forecast in the consolidated estimates; the company’s last quarterly gross margin and net margin provide the most recent context. The main business outlook centers on a balanced mix of new vehicles, used retail, and service, with steady service and F&I contributions supporting margins amid pricing normalization. The most promising segment is new vehicles at $4.63 billion last quarter, though growth prospects hinge on inventory and pricing discipline; services and parts at $1.04 billion showed resilient margin mix and stable year-over-year trends.
Last Quarter Review
Lithia Motors delivered last quarter revenue of $9.68 billion, gross profit margin of 15.35%, GAAP net profit attributable to the parent company of $0.22 billion, net profit margin of 2.24%, and adjusted EPS of $9.50, with year-over-year adjusted EPS growth of 15.71%. A key highlight was a modest EBIT outperformance versus estimates, reflecting disciplined operating execution and a favorable mix in higher-margin service and F&I lines. Main business highlights included new vehicle revenue of $4.63 billion and used retail revenue of $3.10 billion, while services, body and parts contributed $1.04 billion, F&I contributed $0.38 billion, and wholesale used and fleet/other together added $0.53 billion, supporting overall stability.
Current Quarter Outlook
Main Business: New Vehicles
New vehicles remain the largest revenue driver, anchored by franchise breadth and national scale. The last quarter’s $4.63 billion in new vehicle revenue illustrates the central role of factory incentive alignment, inventory flow, and price positioning. In the current quarter, demand normalization and selective promotional activity could temper unit margins, but throughput and brand mix may offset some pressure. A balanced focus on inventory turn, efficient allocation across rooftops, and targeted marketing should support volume consistency. A key swing factor will be OEM production cadence and allocation that determines availability in core segments; any favorable shift can translate quickly into revenue momentum. If incentives remain rational and inventory availability improves, revenue stability should be achievable even with constrained per-unit gross profit, allowing operating leverage in SG&A to contribute to EBIT resilience.
Most Promising Business: Services, Body and Parts
Services, body and parts at $1.04 billion last quarter provide recurring, higher-margin revenue that complements cyclicality in vehicle sales. This segment benefits from the expanding installed base of vehicles sold over prior years, retention initiatives, and the footprint’s scale advantages in technician capacity and parts logistics. In the current quarter, appointment volumes and parts mix are poised to stay firm, supporting gross margin stability relative to retail vehicle sales. Strategic initiatives around customer lifecycle management—including digital scheduling, transparent pricing tools, and warranties—help sustain revenue capture after initial vehicle sale. While this segment’s revenue growth may not be explosive, its margin contribution is consistently supportive of consolidated profitability; in a quarter where vehicle pricing can fluctuate, the services mix may help cushion margin variability and underpin EPS delivery.
Stock Price Drivers This Quarter
Investors are likely to focus on three intertwined factors: unit mix and margins in new and used retail, operating expense control relative to throughput, and F&I attachment rates. Unit mix shifts between higher-demand segments and brands can affect margin outcomes, even if headline revenue trends appear stable. SG&A leverage is especially relevant when volumes soften, making operational discipline crucial to protecting EBIT. F&I penetration and per-vehicle profitability remain critical to sustaining earnings power; small changes in attachment rates and product mix can materially impact EPS. Beyond segment dynamics, management’s commentary on inventory positioning and acquisition pipeline will be watched closely as signals of medium-term growth optionality. If the company demonstrates resilient margins through services and F&I, alongside steadied unit volumes, the market could reward that consistency even with modest headline revenue growth.
Analyst Opinions
Institutional and sell-side commentary over the past six months has trended bullish. Notably, Barclays maintained a Buy rating with a $390.00 price target, Craig-Hallum reaffirmed Buy, and J.P. Morgan reiterated Buy with a $320.00 price target, indicating constructive views on execution and earnings durability. The majority perspective emphasizes the company’s ability to balance volume and margin through diversified revenue streams, with services and F&I stabilizing profitability while new and used retail navigate pricing normalization. Analysts also point to operating scale and disciplined processes as reasons for confidence in EPS delivery against consensus. In this context, the bullish view centers on modest revenue growth aligned with an improved mix and tight SG&A control, supporting the forecast adjusted EPS of $8.11 and the expectation that EBIT can stay near $0.39 billion despite unit margin variability. The dominant opinion suggests upside risk to EPS if services mix holds firm and F&I attachment remains robust, while cautious optimism surrounds revenue given stable inventory levels and selective promotional dynamics.Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
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