The historical rank and industry rank for Lithia Motors's Gross Margin % or its related term are showing as below:
LAD'
s Gross Margin % Range Over the Past 10 Years
Min: 14.95 Med: 15.35 Max: 18.65
Current: 16.41
During the past 13 years, the highestGross Margin % of Lithia Motors was 18.65%. The lowest was 14.95%. And the median was 15.35%.
LAD's Gross Margin % is ranked worse than 60.62% of 1267
companies
in the Vehicles & Parts industry
Industry Median: 19.36
vs LAD: 16.41
Lithia Motors had a gross margin of 15.60% for the quarter that ended in Mar. 2024 => No sustainable competitive advantage
The 5-Year average Growth Rate of Gross Margin for Lithia Motors was 3.40% per year.
Lithia Motors Gross Margin % Historical Data
The historical data trend for Lithia Motors's Gross Margin % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Competitive Comparison of Lithia Motors's Gross Margin %
For the Auto & Truck Dealerships subindustry, Lithia Motors's Gross Margin %, along with its competitors' market caps and Gross Margin % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Lithia Motors's Gross Margin % Distribution in the Vehicles & Parts Industry
For the Vehicles & Parts industry and Consumer Cyclical sector, Lithia Motors's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Lithia Motors's Gross Margin % falls into.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
A positive Gross Profit is only the first step for a company to make a net profit. The gross profit needs to be big enough to also cover related labor, equipment, rental, marketing/advertising, research and development and a lot of other costs in selling the products.
Warren Buffett believes that firms with excellent long term economics tend to have consistently higher margins.
Durable competitive advantage creates a high Gross Margin % because of the freedom to price in excess of cost. Companies can be categorized by their Gross Margin %
1. Greater than 40% = Durable competitive advantage
2. Less than 40% = Competition eroding margins
3. Less than 20% = no sustainable competitive advantage
Consistency of Gross Margin is key
Lithia Motors had a gross margin of 15.60% for the quarter that ended in Mar. 2024 => No sustainable competitive advantage
Be Aware
If a company loses its competitive advantages, usually its gross margin declines well before its sales declines. Watching Gross Margin % and Operating Margin % closely helps avoid value trap situations.
Lithia Motors Gross Margin % Related Terms
Thank you for viewing the detailed overview of Lithia Motors's Gross Margin % provided by GuruFocus.com. Please click on the following links to see related term pages.
Lithia Motors (Lithia Motors) Business Description
Lithia Motors is a retailer of new and used vehicles and related services. The company offers over 45 brands of vehicles at about 350 stores globally including 28 U.S. states at year-end 2022 and entered Canada in mid-2021 with the purchase of Pfaff Automotive and bought Jardine and soon Pendragon in the U.K. in 2023. The company has expanded largely through the acquisition of dealerships in smaller regional markets but now seeks to grow in any part of the U.S. and we expect more deals over time in the U.S. and abroad. Annual revenue in 2022 was $28.2 billion and we see over $50 billion possible in 2025. In 2022, new-car sales were about 46% of total revenue. Lithia was founded in 1946, went public in 1996, and is now the largest U.S. auto dealer. It is based in Medford, Oregon.
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