LAD
Lithia Motors, Inc.
$370.36
Platform & Compounding FCF
85%
Two-stage FCF DCF
Mild
·
Conviction
Overvalued
Trading 0.0% below fair value
Bear
$0.00
-100.0%
3% stage 1 growth, 11% discount
Fair
$0.00
-100.0%
3% stage 1 growth, 11% discount
Bull
$0.00
-100.0%
4% stage 1 growth, 11% discount
Adjust Assumptions
3.0%
11.0%
3.0%
Key Value Driver
FCF growth rate (3% base case)
Terminal Value % of EV
33%
Implied Market Multiple
24.0x
Market is pricing in (growth)
11.5%
vs 3.0% base
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (27 analysts)
$409.29
Divergence from AlphaVal
100%
Summary
Using a two-stage FCF DCF with 3% growth decelerating over 15 years, discounted at 11%, the base-case intrinsic value is $0.00 per share.
Warnings
Wall Street's average price target is $409.29 (from 27 analysts). Our estimate is 100% below the consensus -- consider that gap carefully.
Key Risks
- P/E alone misleads — earnings depressed by growth investment
- Cyclical or commodity businesses may be misclassified as platforms
- Terminal value dominance suggests sensitivity to long-run assumptions