Americas Retail Specialty Hardlines Updating estimates for Lithia Motors and Boyd Group ahead of earnings

Equity Research 12 October 2026 | 12:01AM EDT

Americas Retail: Specialty Hardlines: Updating estimates for Lithia Motors and Boyd Group ahead of earnings

For Lithia Motors, we are updating our estimates to reflect recent industry data and Mark Jordan, CFA | channel commentary. We lower our estimates for new vehicle (retail and fleet) and Goldman Sachs & Co. LLC used retail same-store sales growth, as industry data suggests volumes were likely Kate McShane, CFA softer than our initial estimate, and we lower our estimate for aftersales same-store | sales growth to better reflect recent competitor commentary and our view that Goldman Sachs & Co. LLC

macro headwinds may be causing deferral and/or driving volume to the aftermarket Emily Ghosh | channel. Goldman Sachs & Co. LLC We remain Neutral rated on Lithia despite the company’s attractive valuation (7.1x Nishi Agarwal | NTM P/E) as affordability concerns and macro headwinds create a less certain Goldman Sachs India SPL demand environment in the near term, and as we do not see a clear catalyst to drive upside. We note, however, that we continue to favor management’s flexible approach Grace Chee | to capital allocation and view share repurchases as attractive at current valuations. Goldman Sachs & Co. LLC

Samantha Chiang Our 12-month price target lowers to $362, reflecting our lower estimates and | downside/base/upside case P/E multiples of 7.0x/8.0x/9.0x. Goldman Sachs & Co. LLC

For Boyd Group, we are updating our model to reflect our view that industry-wide demand trends likely remained stable q/q along with muted repair cost inflation, while also acknowledging Boyd’s tougher 2H comparison.

We remain Neutral rated on Boyd Group despite the company’s recently much lower valuation (7.0x NTM EV/EBITDA vs. 10.8x at year-end 2025) as we remain cautious regarding industry growth in the near term, although we expect Boyd will continue taking share.

Our 12-month price target for BYD.TO decreases to C$185 and our price target for BGSI decreases to $130 reflecting our lower estimates and downside/base/upside case EV/EBITDA multiples of 7.0x/9.0x/10.0x.

3Q industry-wide new vehicle sales decreased ~1% compared to the prior year but higher prices acted as an offset

New vehicle sales on a seasonally adjusted annual rate (SAAR) averaged 16.3mn during 3Q, a decline of 1% from last year’s 16.4mn, with higher sales in August (+1.4% y/y) only partially offsetting a softer July (-0.9%) and September (-3.6%),

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Goldman Sachs Americas Retail: Specialty Hardlines

according to data provided by Omdia. Average transaction prices, however, increased roughly 2% y/y during July/August (September data not yet available), according to Kelley Blue Book, and compares to a 1.7% increase in average listing prices for the same period, per Cox Automotive’s vAuto Live Market View data. Omdia data also suggests industry-wide days’ supply ended the quarter lower (-2% y/y in September) following modest increases in July (+3.5%) and August (+2.5%).

Accordingly, we adjust our new vehicle same-store sales growth to -0.1% y/y (from -0.5%), reflecting lower unit growth (-2.5% vs. 1.0%), offset by higher prices (+2.5% vs. +0.5%). We are also reducing our estimate for same-store new vehicle GPUs slightly to $2,700 (from $2,725).

Beyond 3Q, we remain cautious regarding demand in the near term as vehicle affordability (see Exhibit 9) remains pressured with incentive spend well below long-term historical averages (see Exhibit 10) and rising monthly payments (see Exhibit 11) that are approaching an average of $800.

Exhibit 1: New light vehicle sales per month (SAAR) Exhibit 2: New light vehicle sales per month…