Lithia Motors Inc (LAD) is undervalued and Penske Automotive Group Inc (PAG) is fairly valued.
Against our estimates of intrinsic value, LAD trades at the wider discount: a margin of safety of +67%, against +0% for PAG.
Values as of the 22 Sept 2026 close.
Discounting its cash flows at 6.9% (average of 2 methods) values the shares at $940.77; the price of $312.32 is 67% below that value, and 84% of that value comes from beyond year five.
Leak Score 41/100 on 3 of 12 signals
Discounting its cash flows at 7.9% (average of 2 methods) values the shares at $210.83; the price of $209.86 sits right on that value, and 80% of that value comes from beyond year five.
Leak Score 30/100 on 3 of 12 signals
| Metric | LAD | PAG |
|---|---|---|
| Verdict | Undervalued | Fairly valued |
| Price | $312.32 | $209.86 |
| Intrinsic value | $940.77 | $210.83 |
| Margin of safety | +67% | +0% |
| Leak Score | 41/100 (3/12) | 30/100 (3/12) |
| Market cap | $6.9B | $13.8B |
| Revenue growth, 5 years | 23.4% | 9.2% |
| Operating margin | 3.8% | 3.4% |
| Net margin | 1.9% | 2.8% |
| Return on equity | 10.7% | 15.6% |
| Debt to equity | 2.59 | 1.61 |
| P/E | 10.3x | 15.4x |
| Forward P/E | 7.3x | 14.5x |
| P/B | 1.1x | 2.4x |
| Dividend yield | 0.7% | 2.0% |