Forensic Analysis · Retail / Consumer Discretionary · as of Aug 11, 2026
Lithia Motors Inc (LAD)
A forensic read on Lithia Motors Inc built from its complete SEC filings — financial-health screens, earnings quality, red flags and a price-aware rating. Reproducible math, not opinion.
C · Mixed — selective
Forensic grade
Grey Zone
Financial health
2.0
Distress distance
Clean
Earnings quality
5
Forensic signals
11.6
P / E (ttm)
12.4%
ROE
$8.3B
Market cap
0.75%
Dividend yield
4.0%
Revenue growth
This free snapshot doesn't read filing or proxy text, so the auditor-quality and governance checks that can lower a grade were not evaluated (red flags, auditor quality, say on pay, board independence). Those checks only ever lower a grade, so the full analysis can land below the grade above but never above it — treat it as the most favourable reading, not the settled one.
Lithia Motors Inc earns a C (Mixed — selective) forensic quality grade, and its balance-sheet distress test reads 2.0, placing it in the Grey zone. 5 forensic signals were flagged in its latest SEC filings, led by cash conversion.
What the filings flag
0.12×
FY2023–FY2025
Cash conversion.Over FY2023–FY2025, operating cash flow was 0.12× cumulative net income. Reported profit is not turning into cash. The shortfall is profit tied up in working capital rather than collected — the accrual and receivables lines below show where.
6.4%
FY2025
Return on invested capital.Return on invested capital is 6.4% in the latest fiscal year and slipping from 12% — well below its ~9% cost of capital, so reinvested dollars may be destroying value, not building it.
17521% of FCF
FY2025
Shareholder returns.Returned $1.0B to shareholders (buybacks + dividends) in FY2025 — 17521% of free cash flow. More than free cash flow generated — and beyond operating cash too, so the extra is coming from debt or cash reserves, which isn't sustainable indefinitely. Counting the $60M of stock-based comp paid out in shares on top of that, the combined claim on free cash flow is 18560%.
69d
FY2024→FY2025
Inventory days.Days inventory outstanding moved from 64 to 69 FY2024→FY2025 (against cost of goods sold; inventory +4% vs +4% in cost of sales). Inventory is building a little faster than sales — watch for markdowns.
$5M
FY2019–FY2020
Goodwill impairments.Took $5M of goodwill writedowns across 2 years (FY2019 ($2M), FY2020 ($4M)) — about 1% of net income over the span. Writedowns mean past acquisitions underperformed what was paid for them.
Key fundamentals
Latest Revenue$37.63B
Revenue Growth YoY+4.0%
Revenue CAGR (3yr)+10.1%
Net Margin2.2%
Free Cash Flow$5.8M
Return on Equity12.4%
Debt / Equity1.49x
The forensic grade and screens above are free — no account needed. Want the AI investment read on top — the 0–100 rating, thesis, bull-vs-bear, red flags and the 12-month scenario, written from Lithia Motors Inc's actual 10-K/10-Q/8-K filings?