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Group 1 Automotive
(NYSE:GPI)
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Rating:53Neutral
Price Target:
$269.00
▲(2.43% Upside)
Action:Reiterated
Date:08/12/26
The score is primarily held back by weakening financial performance (margin compression, elevated leverage, and softer free cash flow) and bearish technicals (price below major moving averages with negative MACD). These are partially offset by a reasonable valuation (P/E ~11) and a generally constructive earnings update centered on cost actions and aftersales/F&I operational momentum.
Positive Factors
Aftersales Growth
Aftersales provides recurring revenue from the installed vehicle base and is less dependent on new-car volumes. Strong customer-pay and warranty trends, supported by technician additions, can improve earnings resilience over the next several quarters.
Negative Factors
Margin and Revenue Normalization
Falling revenue and compressed operating and net margins show that post-peak profitability has not yet stabilized. The dealership model remains sensitive to vehicle mix, pricing and demand, limiting earnings durability if normalization continues.
Read all positive and negative factors
Positive Factors
Negative Factors
Aftersales Growth
Aftersales provides recurring revenue from the installed vehicle base and is less dependent on new-car volumes. Strong customer-pay and warranty trends, supported by technician additions, can improve earnings resilience over the next several quarters.
Read all positive factors
Group 1 Automotive (GPI) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$3.13B
Dividend Yield0.8%
Average Volume (3M)195.68K
Price to Earnings (P/E)10.9
Beta (1Y)0.60
Revenue Growth0.81%
EPS Growth-33.60%
CountryUS
Employees20,452
SectorConsumer Cyclical
Sector Strength84
IndustryAuto - Dealerships
Share Statistics
EPS (TTM)24.06
Shares Outstanding11,922,225
10 Day Avg. Volume172,557
30 Day Avg. Volume195,675
Financial Highlights & Ratios
PEG Ratio-0.50
Price to Book (P/B)1.79
Price to Sales (P/S)0.22
P/FCF Ratio13.34
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$335.00Price Target Upside27.56% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering6
EPS Forecast (FY)39.42
Revenue Forecast (FY)$22.32B
Group 1 Automotive Business Overview & Revenue Model
Company Description
Group 1 Automotive, Inc. functions as an automotive retail enterprise, operating through its various subsidiary companies. The firm's primary activities include vending new and pre-owned automobiles and light commercial vehicles, as well as vehicl...
How the Company Makes Money
Group 1 Automotive generates revenue primarily through a dealership-based retail model with multiple complementary income streams. (1) New vehicle sales: GPI sells new cars and light trucks through franchised dealerships; revenue is recognized fro...
Group 1 Automotive Earnings Call Summary
Earnings Call Date:Jul 30, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Oct 28, 2026
Earnings Call Sentiment Positive
The call presents a generally constructive picture: the company delivered solid revenue, gross profit and adjusted earnings, demonstrated strong aftersales momentum, improved F&I and dealer productivity (notably via virtual F&I), and outlined a credible $50 million annualized cost program while maintaining liquidity and active capital returns. Offsets include continued unit-volume pressure in new and used vehicles, used-vehicle margin compression (~3% decline), weather-driven aftersales disruption (~$7M), elevated U.S. SG&A (~70.5% of gross in Q1) prompting the headcount reductions (~700 roles), and some one-time/regulatory costs in the U.K. On balance, management's operational fixes, aftersales strength and capital discipline appear to outweigh the near-term challenges.Positive Updates
Solid Top-Line and Profitability
Revenue of $5.4 billion, gross profit of $878 million, adjusted net income of $104 million and adjusted diluted EPS of $8.66 for Q1 2026.
Negative Updates
Volume Pressures in New and Used Vehicles
New vehicle unit sales declined on both a reported and same-store basis in the U.S.; used vehicle retail units also declined on reported and same-store bases.
Read all updates
Q2-2026 Updates
Positive
Negative
Solid Top-Line and Profitability
Revenue of $5.4 billion, gross profit of $878 million, adjusted net income of $104 million and adjusted diluted EPS of $8.66 for Q1 2026.
Read all positive updates
Company Guidance
Management's guidance emphasized cost discipline, capital allocation and operational levers to drive improvement: Q1 results were revenues $5.4B, gross profit $878M, adjusted net income $104M and adjusted diluted EPS $8.66, with an estimated ~$7M weather hit to gross profit; they expect US cost actions (700 roles eliminated, ~$35M headcount + ~$15M contract savings = $50M annualized) to begin benefiting in Q2 (~$12.5M/quarter) and could shave ~200 bps off US SG&A (from ~70.5% toward ~68.5%), while liquidity stood at $714.3M (cash $191M, $523M available on acquisition line), rent‑adjusted leverage 3.09x, adjusted operating cash flow $147M and free cash flow $95M after $53M CapEx; capital priorities include continued buybacks (205,190 shares repurchased in Q1 for ~$72M at $353.08, ~1.7% of shares, $306.3M authorization remaining), selective M&A (2 CA Mercedes‑Benz divested; in UK 1 Skoda + 2 VW acquired, 1 VW + 1 Skoda disposed; framework with Geely and 3 Geely deals opening in Q2), and operational initiatives expected to sustain margins (US new vehicle GPU >$3,300/car, sequential new GPU 3,260→3,313, used GPUs down ~3% but PRU and adjusted F&I GPUs up ~4% with US same‑store customer pay gross ~+6% and UK same‑store parts & service gross +20%; same‑store F&I PRU 1,128 +8%); management reiterated mid‑single‑digit after‑sales growth expectations and ongoing rollout of virtual F&I (installed in 1/3 of US stores doing 20% of deals) with continued benefits into 2027.Group 1 Automotive Financial Statement Overview
Summary
Income Statement
56
Neutral
Balance Sheet
52
Neutral
Cash Flow
47
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 22.15B | 22.57B | 19.93B | 17.87B | 16.22B | 13.48B |
| Gross Profit | 3.47B | 3.50B | 3.24B | 3.02B | 2.97B | 2.44B |
| EBITDA | 824.70M | 881.90M | 1.02B | 1.06B | 1.18B | 963.20M |
| Net Income | 289.60M | 323.70M | 498.20M | 601.60M | 751.50M | 552.10M |
Balance Sheet | ||||||
| Total Assets | 10.29B | 10.35B | 9.82B | 7.77B | 6.72B | 5.75B |
| Cash, Cash Equivalents and Short-Term Investments | 164.50M | 32.50M | 34.40M | 57.20M | 47.90M | 14.90M |
| Total Debt | 5.98B | 5.87B | 5.24B | 3.89B | 3.35B | 2.85B |
| Total Liabilities | 7.33B | 7.56B | 6.85B | 5.10B | 4.48B | 3.92B |
| Stockholders Equity | 2.95B | 2.79B | 2.97B | 2.67B | 2.24B | 1.83B |
Cash Flow | ||||||
| Free Cash Flow | 138.10M | 374.90M | 221.60M | -121.90M | 422.90M | 1.21B |
| Operating Cash Flow | 411.00M | 644.90M | 466.70M | 63.50M | 578.40M | 1.35B |
| Investing Cash Flow | -277.80M | -671.30M | -1.28B | -366.10M | -484.60M | -1.25B |
| Financing Cash Flow | -20.50M | 18.50M | 800.70M | 311.90M | -59.80M | -164.70M |
Group 1 Automotive Technical Analysis
Negative
262.63
Price Trends
295.20
Negative
313.15
Negative
339.99
Negative
Market Momentum
-11.79
Negative
39.98
Neutral
67.75
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GPI, the sentiment is Negative. The current price of 262.63 is below the 20-day moving average (MA) of 269.34, below the 50-day MA of 295.20, and below the 200-day MA of 339.99, indicating a bearish trend. The MACD of -11.79 indicates Negative momentum. The RSI at 39.98 is Neutral, neither overbought nor oversold. The STOCH value of 67.75 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GPI.
Group 1 Automotive Risk Analysis
Group 1 Automotive disclosed 24 risk factors in its most recent earnings report. Group 1 Automotive reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Group 1 Automotive Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
69 Neutral | $6.50B | 9.02 | 33.18% | ― | -0.06% | 35.87% | |
68 Neutral | $3.77B | 7.87 | 13.04% | ― | 4.12% | -2.47% | |
66 Neutral | $8.14B | 12.25 | 10.91% | 0.65% | 1.97% | -10.60% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
57 Neutral | $2.47B | 12.43 | 20.45% | 1.55% | 5.25% | 37.36% | |
54 Neutral | $9.06B | 38.91 | 3.67% | ― | -1.69% | -58.01% | |
53 Neutral | $3.13B | 10.89 | 9.96% | 0.63% | 0.81% | -33.60% |
* Consumer Cyclical Sector Average
GPI
Group 1 Automotive
262.04
-212.90
-44.83%
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Group 1 Automotive Corporate Events
Business Operations and StrategyExecutive/Board ChangesDividends
Group 1 Automotive Announces Quarterly Cash Dividend Approval
Positive
Aug 11, 2026
On August 10, 2026, Group 1 Automotive expanded its Board of Directors from nine to ten members and appointed veteran retail executive David C. Kimbell as a director and Audit Committee member, formalizing standard non-employee director compensati...
Business Operations and StrategyStock BuybackFinancial DisclosuresM&A TransactionsPrivate Placements and Financing
Group 1 Automotive to Acquire Hennessy Dealership Assets
Neutral
Jul 30, 2026
On July 30, 2026, Group 1 Automotive reported second-quarter 2026 results showing a decline in revenue to $5.4 billion and net income from continuing operations to $103.0 million versus the prior year, reflecting softer consumer affordability and ...
Business Operations and StrategyExecutive/Board Changes
Group 1 Automotive Names CFO to Lead U.K. Operations
Positive
May 21, 2026
On May 19, 2026, Group 1 Automotive appointed its chief financial officer, Daniel McHenry, as president and chief executive of its U.K. business, succeeding Mark Raban, who departs after two years leading the unit. McHenry, a long-time executive w...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.