The GAAP EPS miss and 52% net income decline are the headline negatives, but the adjusted EPS beat and $259M buyback may cushion the downside. Watch for further commentary on the Pinewood investment loss trajectory and whether SG&A leverage improves in Q2. The elevated net debt/EBITDA ratio (3.07x) warrants monitoring for potential covenant or credit rating pressure.
Price Chart
Executive Summary
Lithia & Driveway reported Q1 2026 GAAP EPS of $4.28 (down 46% YoY) and adjusted EPS of $7.34 (down 7% YoY), missing the $6.86 consensus on a GAAP basis but beating on adjusted. Revenue grew 1% to $9.3B, slightly above the $9.22B consensus, but net income fell 52% to $102M due to a $73.3M unrealized investment loss and rising SG&A costs. The stock is likely to trade down on the GAAP EPS miss and declining profitability, partially offset by the $259M buyback and record DFC originations.
Key Financial Metrics
Key Facts
- Q1 2026 GAAP EPS $4.28 vs $6.86 consensus (-37.6% miss); adjusted EPS $7.34 vs $7.93 YoY (-7.4%)
- Revenue $9.3B vs $9.22B consensus (+1% YoY, slight beat)
- Net income $102M, down 51.7% YoY from $211.2M; adjusted net income $173.3M, down 18% YoY
- Unrealized loss of $73.3M on Pinewood Technologies investment drove GAAP earnings decline
- SG&A expense rose 8.9% to $1.04B; SG&A as % of gross profit increased to 73.0% from 67.5%
- Repurchased $259M of shares (942K shares at avg $274.62); $362.9M remaining under authorization
- Driveway Finance Corp achieved record originations of $840M with 18.0% penetration and avg FICO 750
- Same-store revenue declined 1.7%; same-store gross profit declined 2.3%
- Net debt to adjusted EBITDA rose to 3.07x from 2.50x a year ago
Financial Impact
GAAP EPS miss of ~37.6% vs consensus; net income halved; adjusted EPS down 7% YoY; revenue slightly above consensus
Risk Factors
- Continued investment losses from Pinewood Technologies could further depress GAAP earnings
- Rising SG&A as % of gross profit (73% vs 67.5% YoY) signals cost control challenges
- Net debt/EBITDA at 3.07x vs 2.50x a year ago increases financial risk
- New vehicle sales down 4.7% and same-store revenue declining 1.7% indicate organic headwinds
Market Snapshot
Investment Themes
Documents Analyzed
This report is based on 1 press release from GlobeNewswire.
| Document | Accession Number |
|---|---|
| PRESS-RELEASE Data (Synthetic) | press-3283511 |
Filters
| Type | Now | ||||
|---|---|---|---|---|---|
Oct 21, 2026 5d ago | 8-K | $269.13 $291.07 | ▲ +8.15% | ▲ +9.33% | $286.84 (+6.58%) |
Sep 29, 2026 27d ago | Press Release | $289.26 | awaiting T+1 | — | $286.84 (−0.84%) |
Sep 25, 2026 4w ago | 8-K | $303.07 $289.26 | ▼ −4.56% | ▼ −4.37% | $286.84 (−5.36%) |
Sep 14, 2026 6w ago | Insider Cluster | $345.91 $339.23 | ▼ −1.93% | ▼ −1.49% | $286.84 (−17.08%) |
Aug 25, 2026 8w ago | Press Release | $371.89 $370.15 | ▼ −0.47% | ▼ −0.49% | $286.84 (−22.87%) |
Jul 30, 2026 12w ago | ANALYST-DOWNGRADE | $405.03 $385.42 | ▼ −4.84% | ▼ −5.55% | $286.84 (−29.18%) |
Jul 29, 2026 12w ago | 8-K | $427.48 $405.03 | ▼ −5.25% | ▼ −6.93% | $286.84 (−32.90%) |
Jul 29, 2026 12w ago | Press Release | $427.48 $405.03 | ▼ −5.25% | ▼ −6.93% | $286.84 (−32.90%) |
Jul 14, 2026 14w ago | Press Release | $319.25 | awaiting T+1 | — | $286.84 (−10.15%) |
Jun 20, 2026 18w ago | Institutional Cluster | $295.15 $297.08 | ▲ +0.65% | ▲ +2.11% | $286.84 (−2.82%) |
US Market Status
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