Lithia Motors Shares Owned By Insiders vs. Return On Equity
| LMO Stock | EUR 346.00 2.00 0.58% |
For Lithia Motors profitability analysis, we use financial ratios and fundamental drivers that measure the ability of Lithia Motors to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well Lithia Motors utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between Lithia Motors's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of Lithia Motors over time as well as its relative position and ranking within its peers.
Lithia |
Lithia Motors Return On Equity vs. Shares Owned By Insiders Fundamental Analysis
Comparative valuation techniques use various fundamental indicators to help in determining Lithia Motors's current stock value. Our valuation model uses many indicators to compare Lithia Motors value to that of its competitors to determine the firm's financial worth. Lithia Motors is rated below average in shares owned by insiders category among its peers. It is rated fifth overall in return on equity category among its peers reporting about 0.12 of Return On Equity per Shares Owned By Insiders. The ratio of Shares Owned By Insiders to Return On Equity for Lithia Motors is roughly 8.18 . The reason why the comparable model can be used in almost all circumstances is due to the vast number of multiples that can be utilized, such as the price-to-earnings (P/E), price-to-book (P/B), price-to-sales (P/S), price-to-cash flow (P/CF), and many others. The P/E ratio is the most commonly used of these ratios because it focuses on the Lithia Motors' earnings, one of the primary drivers of an investment's value.Lithia Return On Equity vs. Shares Owned By Insiders
Shares Owned by Insiders show the percentage of outstanding shares owned by insiders (such as principal officers or members of the board of directors) or private individuals and entities with over 5% of the total shares outstanding. Company executives or private individuals with access to insider information share information about a firm's operations that is not available to the general public.
Lithia Motors |
| = | 2.08 % |
Although the research on effects of insider trading on prices and volatility is still relatively inconclusive, and investors are advised to pay close attention to the distribution of equities among company's stakeholders to avoid many problems associated with the disclosure of price-sensitive information.
Return on Equity or ROE tells company stockholders how effectually their money is being utilized or reinvested. It is a useful ratio when analyzing company profitability or the management effectiveness given the capital invested by the shareholders. ROE shows how efficiently a company utilizes investments to generate income.
Lithia Motors |
| = | 0.25 |
For most industries, Return on Equity between 10% and 30% are considered desirable to provide dividends to owners and have funds for the future growth of the company. Investors should be very careful using ROE as the only efficiency indicator because ROE can be high if a company is heavily leveraged.
Lithia Return On Equity Comparison
Lithia Motors is rated fourth overall in return on equity category among its peers.
Lithia Motors Profitability Projections
The most important aspect of a successful company is its ability to generate a profit. For investors in Lithia Motors, profitability is also one of the essential criteria for including it into their portfolios because, without profit, Lithia Motors will eventually generate negative long term returns. The profitability progress is the general direction of Lithia Motors' change in net profit over the period of time. It can combine multiple indicators of Lithia Motors, where stable trends show no significant progress. An accelerating trend is seen as positive, while a decreasing one is unfavorable. A rising trend means that profits are rising, and operational efficiency may be rising as well. A decreasing trend is a sign of poor performance and may indicate upcoming losses.
Lithia Motors, Inc. operates as an automotive retailer in the United States. Lithia Motors, Inc. was founded in 1946 and is headquartered in Medford, Oregon. LITHIA MOTORS operates under Auto Truck Dealerships classification in Germany and is traded on Frankfurt Stock Exchange. It employs 14538 people.
Lithia Profitability Driver Comparison
Profitability drivers are factors that can directly affect your investment outlook on Lithia Motors. Investors often realize that things won't turn out the way they predict. There are maybe way too many unforeseen events and contingencies during the holding period of Lithia Motors position where the market behavior may be hard to predict, tax policy changes, gold or oil price hikes, calamities change, and many others. The question is, are you prepared for these unexpected events? Although some of these situations are obviously beyond your control, you can still follow the important profit indicators to know where you should focus on when things like this occur. Below are some of the Lithia Motors' important profitability drivers and their relationship over time.
Use Lithia Motors in pair-trading
One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Lithia Motors position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Lithia Motors will appreciate offsetting losses from the drop in the long position's value.Lithia Motors Pair Trading
Lithia Motors Pair Trading Analysis
The ability to find closely correlated positions to Lithia Motors could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Lithia Motors when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Lithia Motors - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Lithia Motors to buy it.
The correlation of Lithia Motors is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Lithia Motors moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Lithia Motors moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Lithia Motors can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.Use Investing Themes to Complement your Lithia Motors position
In addition to having Lithia Motors in your portfolios, you can quickly add positions using our predefined set of ideas and optimize them against your very unique investing style. A single investing idea is a collection of funds, stocks, ETFs, or cryptocurrencies that are programmatically selected from a pull of investment themes. After you determine your investment opportunity, you can then find an optimal portfolio that will maximize potential returns on the chosen idea or minimize its exposure to market volatility.Did You Try This Idea?
Run Latest Losers Thematic Idea Now
Latest Losers
Dynamically computed list of top equities currently sorted across major exchanges. The Latest Losers theme has 127 constituents at this time.
You can either use a buy-and-hold strategy to lock in the entire theme or actively trade it to take advantage of the short-term price volatility of individual constituents. Macroaxis can help you discover thousands of investment opportunities in different asset classes. In addition, you can partner with us for reliable portfolio optimization as you plan to utilize Latest Losers Theme or any other thematic opportunities.
| View All Next | Launch |
Additional Information and Resources on Investing in Lithia Stock
When determining whether Lithia Motors is a strong investment it is important to analyze Lithia Motors' competitive position within its industry, examining market share, product or service uniqueness, and competitive advantages. Beyond financials and market position, potential investors should also consider broader economic conditions, industry trends, and any regulatory or geopolitical factors that may impact Lithia Motors' future performance. For an informed investment choice regarding Lithia Stock, refer to the following important reports:Check out Correlation Analysis. For more detail on how to invest in Lithia Stock please use our How to Invest in Lithia Motors guide.You can also try the Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
To fully project Lithia Motors' future profitability, investors should examine all historical financial statements. These statements provide investors with a comprehensive snapshot of the financial position of Lithia Motors at a specified time, usually calculated after every quarter, six months, or one year. Three primary documents fall into the category of financial statements. These documents include Lithia Motors' income statement, its balance sheet, and the statement of cash flows.