KeyBanc Starts Lithia Motors (LAD) at Buy; Margin Stability and A Unique Geographic Mix

KeyBanc initiates coverage on Lithia Motors (NYSE: LAD) with a Buy. PT $30.00.

KeyBanc analyst said, "We are initiating coverage of LAD with a BUY as: 1) a slightly differentiated business model (franchise exclusivity) and a unique geographic mix (approximately 50%Pacific Northwest) distinguishes the Company from its peers, while it is also well positioned in terms of scale and associated cost savings, ownership of real estate and a relatively clean balance sheet (excluding mortgage debt); 2) catalysts exist for near and longer-term increases in the U.S. light vehicle SAAR-in particular, we are encouraged that market share at Chrysler (30% of sales) appears to have stabilized and LAD's product portfolio is expected to improve; 3) LAD appears well positioned to grow through acquisitions, and given company size and share count, could materially impact results...We are introducing earnings estimates of $1.88 (First Call consensus $1.88) for 2011 and $2.05 (First Call consensus $2.04) for 2012."

For an analyst ratings summary and ratings history on Lithia Motors click here. For more ratings news on Lithia Motors click here.

Shares of Lithia Motors closed at $24.16 yesterday.

---

Serious News for Serious Traders! Try StreetInsider.com Premium Free!

---

You May Also Be Interested In

• Tesla plans 'flying' Roadster stunt at SpaceX Texas site as early as August
• Cisco rating cut at HSBC as analyst sees a lack of catalysts
• Optimum Communications gets NYSE non-compliance notice over stock price