UPDATE: Stifel Nicolaus Initiates Buy, $30 Target on Lithia Motors

Stifel Nicolaus initiates its coverage on Lithia Motors LAD with a Buy rating and a price target of $30 on the company's exclusivity, growth and industry-leading rate of change. Stifel Nicolaus says, "Given its concentration in smaller western U.S. markets (avg, 250,000 pop.), many LAD stores are exclusive dealers of a particular automotive brand within a 100-mile radius. From 1997 to 2007 LAD's portfolio grew at a 32% CAGR, gross margin rates remained at or near best-in-class (16-17%), and costs (by and large) remained in check (SG&A averaged 75% of GP). LAD also rode shotgun for the historical fall of Chrysler, GM, and its own ROIC - all three of which seem to be on pace for a similarly dramatic comeback." LAD closed at $24.57 a share yesterday.