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LAD vs LEA

LAD
Lithia Motors, Inc.
NEUTRAL
Price
$277.24
Market Cap
$6.46B
Sector
Consumer Cyclical
AI Confidence
85%
LEA
Lear Corporation
NEUTRAL
Price
$124.16
Market Cap
$6.29B
Sector
Consumer Cyclical
AI Confidence
80%

Valuation

P/E Ratio
LAD
8.58
LEA
15.25
Forward P/E
LAD
6.88
LEA
7.36
P/B Ratio
LAD
0.99
LEA
1.25
P/S Ratio
LAD
0.17
LEA
0.27
EV/EBITDA
LAD
11.15
LEA
5.44

Profitability

Gross Margin
LAD
15.43%
LEA
7.5%
Operating Margin
LAD
3.89%
LEA
4.4%
Profit Margin
LAD
2.18%
LEA
1.88%
ROE
LAD
12.42%
LEA
10.76%
ROA
LAD
4.22%
LEA
4.49%

Growth

Revenue Growth
LAD
0.3%
LEA
4.8%
Earnings Growth
LAD
-28.4%
LEA
-2.0%

Financial Health

Debt/Equity
LAD
2.35
LEA
0.67
Current Ratio
LAD
1.17
LEA
1.35
Quick Ratio
LAD
0.22
LEA
0.91

Dividends

Dividend Yield
LAD
0.79%
LEA
2.48%
Payout Ratio
LAD
6.75%
LEA
37.79%

AI Verdict

LAD NEUTRAL

LAD presents a classic 'value trap' profile, characterized by a weak Piotroski F-Score of 3/9 indicating deteriorating financial health and crashing earnings growth (-28.4% YoY). While the stock appears significantly undervalued based on the Graham Number ($452.1) and a low P/E of 8.58, the fundamental decay and bearish technical trend offset these valuation advantages. The divergence between the bullish analyst target ($364.60) and the negative earnings trajectory suggests a disconnect between market expectations and current operational reality.

Strengths
Extremely low P/E ratio (8.58) and Forward P/E (6.88)
Strong defensive valuation relative to Graham Number ($452.1)
Very low Price-to-Sales ratio (0.17) indicating high revenue efficiency relative to market cap
Risks
Weak financial health as evidenced by a Piotroski F-Score of 3/9
Severe earnings contraction with YoY growth at -28.40% and Q/Q at -35.60%
High leverage with a Debt/Equity ratio of 2.35
LEA NEUTRAL

Lear Corporation presents a complex profile characterized by a stable Piotroski F-Score of 6/9 and a valuation that is defensively attractive, trading below its Graham Number of $134.94. While the forward P/E of 7.36 and PEG of 0.36 suggest significant undervaluation, this is offset by razor-thin profit margins (1.88%) and a bearish technical trend. The stark contrast between the Graham Number and the growth-based intrinsic value ($56.98) indicates a stock that is valued more for its assets and current earnings than for future growth. Overall, the strong analyst 'buy' consensus is countered by bearish insider selling and weak technical momentum.

Strengths
Highly attractive valuation metrics (Forward P/E 7.36, PEG 0.36)
Trading below the Graham Number ($134.94), providing a defensive margin of safety
Consistent history of earnings beats over the last 25 quarters
Risks
Extremely low profit margins (1.88%) leave little room for error in a cyclical industry
Bearish insider sentiment with 7 sell transactions and 0 buys in the last 6 months
Technical trend is currently 0/100 (Bearish)

Compare Another Pair

LAD vs LEA: Head-to-Head Comparison

This page compares Lithia Motors, Inc. (LAD) and Lear Corporation (LEA) across key fundamental metrics including valuation ratios, profitability margins, growth rates, financial health indicators, and dividend metrics. Each metric highlights the better-performing stock so you can quickly identify relative strengths and weaknesses.

Our AI engine independently analyzes each company's financials, competitive position, and market conditions to produce a verdict (Bullish, Neutral, or Bearish) along with key strengths and risks. Use this comparison alongside your own research to make informed investment decisions.

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