Here’s What Boosted Lithia Motors (LAD) in Q4

In its 4th fourth 2024 capitalist letter, River Road Small-Mid Cap Value Fund emphasized stocks specified arsenic Lithia Motors, Inc. (NYSE:LAD). Lithia Motors, Inc. (NYSE:LAD) is simply a planetary automotive retailer that operates done Vehicle Operations and Financing Operations segments.  The one-month instrumentality Lithia Motors, Inc. (NYSE:LAD) was -6.35%, and its shares gained 4.19% of their worth implicit the past 52 weeks. On April 1, 2025, Lithia Motors, Inc. (NYSE:LAD) banal closed astatine $296.83 per stock with a marketplace capitalization of $7.798 billion.

River Road Small-Mid Cap Value Fund stated the pursuing regarding Lithia Motors, Inc. (NYSE:LAD) successful its Q4 2024 capitalist letter:

"Another apical contributor during the 4th was Lithia Motors, Inc. (NYSE:LAD) 1 of the largest planetary automotive retailers operating successful North America and the United Kingdom. In precocious June, the car manufacture was impacted by a cyberattack connected CDK Global’s dealership absorption system, which runs each back-office functions astatine Lithia arsenic good arsenic implicit 85% of each franchised dealers successful the United States. In its Q2 2024 net release, LAD reported a -6.4% diminution successful same-store sales, driven chiefly by a -4.7% diminution successful caller conveyance units arsenic LAD was not capable to process merchantability transactions precocious successful the 4th owed to the CDK outage. Despite little same-store sales, LAD outperformed expectations arsenic its outgo simplification initiatives and a displacement successful superior allocation resulted successful sequential borderline betterment and a little stock count. The institution achieved its $150MM successful annualized outgo savings people up of docket and present expects to treble these savings by the extremity of 2024 done further inventory optimization and reductions. This volition effect successful the all-important SG&A arsenic a percent gross nett declining to the mid-60s scope and successful enactment with LAD’s semipermanent target. Acquisitions person added $27B successful annualized revenues since 2020, up of LAD’s extremity of adding $25B successful acquired revenues by 2025. Given the existent precocious backstage marketplace multiples for car dealerships, LAD’s absorption has shifted its superior allocation toward stock repurchases, buying backmost 2.9% of the institution successful Q2. With debased nett leverage of 2.3x and year-to-date escaped currency travel of $740MM, we expect absorption to proceed repurchasing shares aggressively. During the quarter, we added to the presumption anterior to its Q2 results."