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0 of 3 Premium Clicks used this month SUBSCRIBE Print + Online Subscriber Activation | Register x Forgot Password | Need an Account? e-edition | subscribe | newsletter | deals Classifieds Jobs Autos Real Estate FEATURED » NEWS NOW Roseburg thrift stores deluged with trash ... Rogue Valley residents inspired by Pope Francis' speech ... Brush with Kindness ... Roseburg thrift stores deluged with trash ... Rogue Valley residents inspired by Pope Francis' speech ... Brush with Kindness ... AUTO INDUSTRY Lithia Motors nets $40.7 million in first quarter Medford auto retailer sizing up acquisition targets Comment By Greg Stiles Mail Tribune MailTribune.com By Greg Stiles Mail Tribune Posted Apr. 22, 2015 at 4:45 PM Updated Apr 22, 2015 at 5:44 PM By Greg Stiles Mail Tribune Posted Apr. 22, 2015 at 4:45 PM Updated Apr 22, 2015 at 5:44 PM » Social News With revenue, profit, stock and dividends hitting all-time highs, Lithia Motors is raring for more. The Medford auto retailer Wednesday announced its best first quarter, and second-best reporting period, ever. Lithia reported a 66 percent increase in revenue, to $1.8 billion from $1.1 billion, during the first quarter of 2014. It was the second-best overall quarter performance in company history. The Medford-based auto retailer's net earnings soared 64 percent to $40.7 million in the first quarter from $24.7 million a year ago. It came in just shy of the $41.1 million profit reported in the fourth quarter of 2014. While no deals were announced during the first three months of the year, a combination of graying owners seeking to unload their dealerships and underperforming stores needing the Midas touch suggests Lithia could expand in the near future. "We are actively evaluating acquisition candidates and note that with the DCH combination, we now have identified over 2,600 potential target stores," CEO and President Bryan DeBoer told analysts during a Wednesday conference call. "We remain confident in our ability to find ... purchases to increase our portfolio and grow earnings." While it would be hard to top last year's $362.5 million acquisition of DCH Auto Group, DeBoer suggested the company is poised for when the time is ripe. "Obviously, there are only about nine other ones that are larger than DCH in the country, so those may be a little hard to come by," DeBoer said. "But ones that are about half that size or maybe a quarter of that size are out there. We really believe that those are definitely on the radar." The range of dealerships with $50 million to $70 million in annual sales grew with the DCH acquisition, he said. "There is a pretty active market in that arena, both in our exclusive markets and now in the metropolitan market," DeBoer said. "Our availability of candidates grew from about 1,200 to about 2,600 when we went into those metropolitan markets." While hundreds of dealers are willing to consider offers, prices have climbed with muscle-car acceleration. John Shackelford, a Dallas lawyer who represents auto dealers in transactions, said the industry rebound provided the opportunity for dealers to recoup past losses. While widespread acquisitions have driven up store values, present interest rates provide buyers with cheap capital. "We've seen a flurry of activity because car sales have been extremely strong," Shackelford said. "As a result, it's got a lot of established dealerships with mature owners thinking about retiring." Dealers who missed out when larger companies were snapping up dealerships a decade ago are ready to jump this time. "The asset that had provided their living lost its value during the auto industry slump," he said. "Now that the economy has turned around, a lot of people are thinking they will never see days like this again and it's time to sell. They don't want to be standing on the sidelines." Shackelford said dealerships typically sold for three times their annual sales 20 years ago. "Now we're seeing multiples of five times in rural markets with much smaller sales, and nine times in metro areas," he said. "Historically speaking, bargains are hard to find." Increasingly, however, auto groups and other deep-pocketed buyers, such as Warren Buffet's Berkshire Hathaway, look beyond the higher prices because the sale can be financed with cheap money. "You know inflation will eventually come back and interest rates will go up," Shackelford said. "You're better off buying now and betting the asset will appreciate." For the fourth straight quarter, Lithia Motors registered double-digit growth in all its business lines, DeBoer said, noting the company averaged 57 used car sales per month during the quarter, up from 55 the same period a year ago and 50 two years ago. The company announced a 20-cent-per-share dividend, and shares gained 4 cents to close at $102.54. Reach reporter Greg Stiles at 541-776-4463 or [email protected]. By Greg Stiles Mail Tribune MailTribune.com By Greg Stiles Mail Tribune Posted Apr. 22, 2015 at 4:45 PM Updated Apr 22, 2015 at 5:44 PM » Comment or view comments Reader Reaction » STAY INFORMED Email NewsLetter Sign Up Today Sign up for our newsletter and have the top headlines from your community delivered right to your inbox. Southern Oregon Directory Featured Businesses Loading... 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