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Group 1 Automotive
(NYSE:GPI)
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Rating:52Neutral
Price Target:
$245.00
â–¼(-6.71% Downside)
Action:Reiterated
Date:10/21/26
GPI scores in the low-to-mid range primarily due to weakening financial performance (margin compression, elevated leverage, and reduced free cash flow versus prior periods). Technicals further weigh on the score given the downtrend versus key moving averages and a negative MACD. These pressures are partly offset by a low P/E valuation and a generally constructive earnings call centered on cost actions, aftersales/F&I strength, and ongoing capital returns.
Positive Factors
Aftersales and F&I Growth
Aftersales and F&I provide recurring, higher-value revenue beyond vehicle sales and are supported by the installed vehicle base. Recent gains in customer-pay service, warranty work and F&I productivity broaden earnings sources and can make profitability more resilient through vehicle-cycle fluctuations.
Negative Factors
Margin and Revenue Compression
Declining revenue and lower net and EBIT margins show that the business has moved well below prior peak profitability. This compression reduces earnings conversion from each sales dollar and leaves results more exposed to further normalization in dealership demand and gross profit.
Read all positive and negative factors
Positive Factors
Negative Factors
Aftersales and F&I Growth
Aftersales and F&I provide recurring, higher-value revenue beyond vehicle sales and are supported by the installed vehicle base. Recent gains in customer-pay service, warranty work and F&I productivity broaden earnings sources and can make profitability more resilient through vehicle-cycle fluctuations.
Read all positive factors
Group 1 Automotive Key Performance Indicators (KPIs)
Group 1 Automotive (GPI) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$2.68B
Dividend Yield0.96%
Average Volume (3M)257.77K
Price to Earnings (P/E)9.3
Beta (1Y)0.56
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. Volume218,225
30 Day Avg. Volume257,775
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 Cap3.38
Enterprise Value/Revenue0.41
Enterprise Value/Gross Profit2.61
Enterprise Value/Ebitda10.99
Forecast
1Y Price Target
$303.29Price Target Upside15.48% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering7
EPS Forecast (FY)37.48
Revenue Forecast (FY)$22.05B
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 primarily makes money through a diversified dealership-based revenue model spanning vehicle retailing, aftersales service, and finance-related products. (1) New vehicle sales: GPI sells new vehicles as a franchised dealer for mu...
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
Neutral
262.63
Price Trends
255.37
Negative
280.62
Negative
310.32
Negative
Market Momentum
-6.20
Negative
48.97
Neutral
49.16
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GPI, the sentiment is Neutral. The current price of 262.63 is above the 20-day moving average (MA) of 239.18, above the 50-day MA of 255.37, and below the 200-day MA of 310.32, indicating a neutral trend. The MACD of -6.20 indicates Negative momentum. The RSI at 48.97 is Neutral, neither overbought nor oversold. The STOCH value of 49.16 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral 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 |
|---|---|---|---|---|---|---|---|
65 Neutral | $2.95B | 6.13 | 13.04% | ― | 4.12% | -2.47% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
61 Neutral | $13.94B | 15.61 | 16.43% | 2.66% | 4.13% | -5.43% | |
57 Neutral | $5.35B | 6.95 | 33.18% | ― | -0.06% | 35.87% | |
54 Neutral | $6.58B | 6.16 | 12.10% | 0.88% | 1.46% | ― | |
53 Neutral | $2.02B | 9.51 | 20.45% | 2.60% | 5.25% | 37.36% | |
52 Neutral | $2.68B | 9.35 | 9.96% | 0.96% | 0.81% | -33.60% |
* Consumer Cyclical Sector Average
GPI
Group 1 Automotive
242.79
-185.39
-43.30%
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Group 1 Automotive Corporate Events
Business Operations and StrategyM&A TransactionsPrivate Placements and Financing
Group 1 Automotive completes $1.3B Hennessy acquisition
Positive
Oct 21, 2026
Group 1 Automotive completed its previously announced acquisition of Hennessy Automobile Companies’ assets on October 19, 2026, securing 10 automobile dealerships and one collision center in the greater Atlanta, Georgia market, along with re...
Business Operations and StrategyPrivate Placements and Financing
Group 1 Automotive Secures $190 Million Term Loan Agreement
Positive
Sep 24, 2026
On September 23, 2026, Group 1 Realty, Inc., a subsidiary of Group 1 Automotive, Inc., entered into a master credit agreement with Bank of America providing a non-revolving term loan of up to $190.3 million, equal to 85% of the appraised value of ...
Business Operations and StrategyM&A TransactionsPrivate Placements and Financing
Group 1 Automotive Completes $1.25 Billion Notes Offering
Positive
Sep 22, 2026
On September 22, 2026, Group 1 Automotive completed a $1.25 billion private offering of senior unsecured notes, split between $625 million of 6.250% notes due 2032 and $625 million of 6.625% notes due 2035, generating net proceeds of about $1.236 ...
Business Operations and StrategyExecutive/Board Changes
Group 1 Automotive adds Conifer representative to board
Positive
Sep 22, 2026
On September 21, 2026, Group 1 Automotive entered into a stockholder agreement with Conifer Management, one of its largest shareholders, that will expand the company’s board from ten to eleven members and add Conifer analyst Benjamin Hart as...
Business Operations and StrategyM&A TransactionsPrivate Placements and Financing
Group 1 Automotive prices notes to fund acquisition
Positive
Sep 10, 2026
On September 8, 2026, Group 1 Automotive priced a private placement of $1.25 billion in senior unsecured notes, split evenly between 6.250% notes due 2032 and 6.625% notes due 2035, with closing expected on September 22, 2026. The notes, sold at p...
Business Operations and StrategyM&A TransactionsPrivate Placements and Financing
Group 1 Automotive Plans $1.25 Billion Notes Offering
Positive
Sep 8, 2026
On September 8, 2026, Group 1 Automotive announced a planned private offering of $1.25 billion in senior unsecured notes, split evenly between maturities in 2032 and 2035, to qualified institutional buyers and certain non-U.S. investors. The notes...
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 ...
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.