Latest Ratios: P/E Ratio 9.6x · EV/EBITDA 11.6x · ROE 12.3%. (1996–2025 historical series)
Price-based multiples — how expensive the stock is relative to earnings, sales, book value, and cash flow
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Market Cap | $7.0B | $8.4B | $9.7B | $9.1B | $5.8B | $8.6B | $7.1B | $3.4B | $1.9B | $2.9B | $2.5B |
| Enterprise Value | $21.4B | $22.8B | $23.1B | $19.5B | $13.5B | $13.4B | $11.1B | $7.1B | $5.3B | $5.8B | $4.8B |
| P/E Ratio → | 9.56 | 10.28 | 12.05 | 9.07 | 4.63 | 8.12 | 15.00 | 12.67 | 7.03 | 11.65 | 12.54 |
| P/S Ratio | 0.19 | 0.22 | 0.27 | 0.29 | 0.21 | 0.38 | 0.54 | 0.27 | 0.16 | 0.28 | 0.28 |
| P/B Ratio | 1.18 | 1.27 | 1.45 | 1.45 | 1.10 | 1.85 | 2.65 | 2.34 | 1.56 | 2.63 | 2.71 |
| P/FCF | 36.72 | 43.99 | 131.43 | — | — | 5.60 | 12.19 | 8.61 | 5.17 | 65.54 | — |
| P/OCF | 12.98 | 15.55 | 22.79 | — | — | 4.79 | 9.45 | 6.56 | 3.60 | 19.15 | 27.19 |
P/E links to full P/E history page with 30-year chart
Enterprise-value multiples — capital-structure-neutral measures of total business value
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| EV / Revenue | — | 0.61 | 0.64 | 0.63 | 0.48 | 0.59 | 0.84 | 0.56 | 0.45 | 0.57 | 0.55 |
| EV / EBITDA | 11.60 | 12.36 | 11.78 | 9.95 | 6.24 | 7.33 | 13.59 | 11.71 | 10.11 | 12.34 | 12.41 |
| EV / EBIT | 14.98 | 12.07 | 12.38 | 10.29 | 6.91 | 8.32 | 14.67 | 14.02 | 11.58 | 13.68 | 14.48 |
| EV / FCF | — | 118.75 | 314.06 | — | — | 8.72 | 19.13 | 17.85 | 14.60 | 132.42 | — |
Margins and return-on-capital ratios measuring operating efficiency
Full margin charts and quarterly trend are on the Earnings History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Gross Margin | 15.2% | 15.2% | 15.4% | 16.8% | 18.3% | 18.7% | 16.9% | 15.4% | 15.0% | 15.0% | 15.0% |
| Operating Margin | 3.8% | 3.8% | 4.4% | 5.5% | 6.9% | 7.3% | 5.3% | 3.9% | 3.8% | 4.1% | 3.9% |
| Net Profit Margin | 2.2% | 2.2% | 2.2% | 3.2% | 4.4% | 4.6% | 3.6% | 2.1% | 2.2% | 2.4% | 2.3% |
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| ROE | 12.3% | 12.3% | 12.4% | 17.4% | 25.2% | 28.9% | 22.8% | 20.4% | 23.3% | 24.6% | 22.7% |
| ROA | 3.4% | 3.4% | 3.8% | 5.8% | 9.6% | 11.1% | 6.7% | 4.7% | 5.3% | 5.8% | 5.6% |
| ROIC | 5.2% | 5.2% | 6.4% | 8.6% | 13.0% | 15.5% | 8.8% | 7.6% | 7.8% | 8.5% | 8.5% |
| ROCE | 8.2% | 8.2% | 10.1% | 12.8% | 18.9% | 23.5% | 15.5% | 15.5% | 17.0% | 19.0% | 19.0% |
Solvency and debt-coverage ratios — lower is generally safer
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt / Equity | 2.22 | 2.22 | 2.08 | 1.80 | 1.52 | 1.06 | 1.57 | 2.57 | 2.87 | 2.74 | 2.63 |
| Debt / EBITDA | 7.97 | 7.97 | 7.05 | 5.79 | 3.69 | 2.71 | 5.13 | 6.20 | 6.59 | 6.36 | 6.17 |
| Net Debt / Equity | — | 2.16 | 2.02 | 1.65 | 1.48 | 1.03 | 1.51 | 2.52 | 2.85 | 2.69 | 2.57 |
| Net Debt / EBITDA | 7.78 | 7.78 | 6.85 | 5.31 | 3.57 | 2.62 | 4.93 | 6.06 | 6.53 | 6.23 | 6.04 |
| Debt / FCF | — | 74.76 | 182.63 | — | — | 3.11 | 6.94 | 9.24 | 9.43 | 66.88 | — |
| Interest Coverage | 2.42 | 2.42 | 3.49 | 5.38 | 11.67 | 12.81 | 7.12 | 3.81 | 3.85 | 5.68 | 6.81 |
Short-term solvency ratios and asset-utilisation metrics
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Current Ratio | 1.17 | 1.17 | 1.19 | 1.41 | 1.46 | 1.38 | 1.35 | 1.20 | 1.20 | 1.21 | 1.19 |
| Quick Ratio | 0.26 | 0.26 | 0.28 | 0.44 | 0.38 | 0.38 | 0.34 | 0.25 | 0.25 | 0.28 | 0.27 |
| Cash Ratio | 0.05 | 0.05 | 0.06 | 0.19 | 0.08 | 0.07 | 0.07 | 0.03 | 0.01 | 0.02 | 0.03 |
| Asset Turnover | — | 1.50 | 1.56 | 1.58 | 1.88 | 2.05 | 1.66 | 2.08 | 2.20 | 2.15 | 2.26 |
| Inventory Turnover | 5.21 | 5.21 | 5.18 | 5.43 | 6.76 | 7.79 | 4.37 | 4.40 | 4.25 | 4.02 | 4.16 |
| Days Sales Outstanding | — | 11.00 | 12.48 | 13.00 | 10.53 | 10.96 | 17.07 | 14.54 | 16.35 | 18.89 | 17.57 |
Earnings, FCF, buyback, and dividend yields — total returns to shareholders
Full dividend history and growth charts are on the Dividend History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Dividend Yield | 0.7% | 0.7% | 0.6% | 0.6% | 0.8% | 0.5% | 0.4% | 0.8% | 1.5% | 0.9% | 1.0% |
| Payout Ratio | 6.7% | 6.7% | 7.0% | 5.3% | 3.6% | 3.7% | 6.2% | 10.2% | 10.4% | 10.8% | 12.2% |
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings Yield | 10.5% | 9.7% | 8.3% | 11.0% | 21.6% | 12.3% | 6.7% | 7.9% | 14.2% | 8.6% | 8.0% |
| FCF Yield | 2.7% | 2.3% | 0.8% | — | — | 17.8% | 8.2% | 11.6% | 19.3% | 1.5% | — |
| Buyback Yield | 13.6% | 11.4% | 3.8% | 0.5% | 11.9% | 2.7% | 0.7% | 0.1% | 8.0% | 1.2% | 4.6% |
| Total Shareholder Yield | 14.3% | 12.0% | 4.4% | 1.1% | 12.7% | 3.1% | 1.1% | 0.9% | 9.4% | 2.1% | 5.5% |
| Shares Outstanding | — | $25M | $27M | $28M | $28M | $29M | $24M | $23M | $25M | $25M | $26M |
High leverage and liquidity
According to current market data, Lithia's P/E ratio of 9.04x sits at a discount to several peers, suggesting that investors are pricing in significant execution risk regarding the company's ability to maintain its historical acquisition-led growth trajectory amidst a challenging macroeconomic environment for automotive retail.
The current valuation appears to reflect a market skepticism toward the sustainability of inorganic growth, particularly as the company's PEG ratio of 0.85 indicates that the market is not fully rewarding the current earnings profile. Investors should monitor whether this discount persists as a structural feature of the business model or if it represents a temporary mispricing of the company's long-term digital platform potential.
Based on reported financial figures, Lithia's ROIC has trended downward from 1.7% in 2023Q4 to 1.2% in 2026Q1, indicating that the company is struggling to generate adequate returns on its massive capital base as the cost of financing acquisitions continues to outpace operational gains.
The decline in ROIC suggests that the company's aggressive roll-up strategy may be encountering diminishing marginal returns, as the cost of integrating new dealerships weighs heavily on overall capital efficiency. This trend warrants further investigation into whether the company's capital allocation strategy is effectively creating shareholder value or merely expanding the asset base without commensurate profitability improvements.
As reported in recent quarterly filings, Lithia's days inventory outstanding has fluctuated near 71 days, which, when combined with a tightening current ratio of 0.99, suggests that the company's working capital efficiency is being compromised by the need to carry higher inventory levels in a slowing market.
The inability to optimize the cash conversion cycle while managing inventory levels indicates potential operational friction in the company's hub-and-spoke model. Investors should monitor whether these efficiency metrics stabilize, as persistent inventory bloat could necessitate further margin-diluting promotional activity to clear older vehicle stock.
According to recent balance sheet data, Lithia's interest coverage ratio has deteriorated to 1.72x in 2026Q1 from 3.18x in 2023Q4, signaling that the company's ability to service its substantial debt load is becoming increasingly sensitive to fluctuations in interest rates and operating income volatility.
The reliance on debt to fund the acquisition pipeline appears to be creating a precarious financial position, particularly as the company's debt-to-EBITDA ratio remains elevated. This leverage profile suggests that any further contraction in operating margins could significantly impair the company's financial flexibility and its capacity to continue its aggressive expansion strategy.
Based on industry analysis, the P/E ratio is frequently misapplied to Lithia's business model because it fails to account for the significant non-cash depreciation and floorplan interest expenses that are inherent to the dealership model, thereby obscuring the company's true underlying cash-generating capacity.
Analysts should instead prioritize EV/EBITDA or P/FCF metrics, which better capture the capital-intensive nature of the dealership business and the impact of inventory financing on the bottom line. Relying solely on P/E ratios may lead to an incomplete assessment of the company's operational health, as it ignores the structural costs required to maintain the physical and digital infrastructure.
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Quick answers to the most common questions about buying LAD stock.
Lithia Motors, Inc.'s current P/E ratio is 9.6x. The historical average is 13.3x. This places it at the 21th percentile of its historical range.
Lithia Motors, Inc.'s current EV/EBITDA is 11.6x. This enterprise value multiple compares the company's total value (equity + debt - cash) to its EBITDA. The historical average is 11.4x.
Lithia Motors, Inc.'s return on equity (ROE) is 12.3%. The historical average is 14.1%.
Based on historical data, Lithia Motors, Inc. is trading at a P/E of 9.6x. This is at the 21th percentile of its historical P/E range. Compare with industry peers and growth rates for a complete picture.
Lithia Motors, Inc.'s current dividend yield is 0.70% with a payout ratio of 6.7%.
Lithia Motors, Inc. has 15.2% gross margin and 3.8% operating margin.
Lithia Motors, Inc.'s Debt/EBITDA ratio is 8.0x, indicating high leverage. A ratio above 4x may signal elevated financial risk.