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Here's Why You Should Buy Group 1 (GPI) Stock Right Now
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Group 1 Automotive (GPI - Free Report) is benefiting from a diversified product mix, omni-channel efforts and acquisitions of dealerships and franchises.
We are positive about the company’s prospects and believe that the time is right for you to add the stock to your portfolio as it looks promising and is poised to carry the momentum ahead.
Let’s delve deeper into the factors that make this Zacks Rank #2 (Buy) stock an attractive choice for investors right now.
An Outperformer
Shares of Group 1 have rallied 14.6% in a year, exceeding the 6.4% rise of its industry. It has also outperformed the S&P 500’s 1.9% decline over the same period.
Image Source: Zacks Investment Research
Positive Earnings Surprise History
Group 1 has outpaced the Zacks Consensus Estimate in each of the trailing four quarters, delivering an earnings surprise of 6.63%, on average.
Estimates Going Up
Over the past two months, the Zacks Consensus Estimate for earnings has increased around 10.6% for the company. The consensus estimate for second-quarter 2022 has also been revised 5.4% upward over the same time frame. The favorable estimate revisions instill investors’ confidence in the stock.
Strong Growth Prospects
The Zacks Consensus Estimate for GPI’s 2022 earnings is currently pegged at $41.89, implying an expected year-over-year growth of 21.3%. Earnings are also expected to register a 2.4% rise in the second quarter.
Growth Drivers in Place
In the recently reported first quarter of 2022, sales in the company’s retail vehicle units, Parts and Service unit and Finance and Insurance unit saw robust growth. Revenues across the two business segments, the U.S. business and the U.K. business, also increased. The segmental revenue growth buoyed the firm’s top line which also rose 27.7% overall year over year.
A diversified product mix and multiple streams of income look to reduce GPI’s risk profile. The firm is dedicated to its omni-channel efforts to boost sales. Digitization initiatives, focused on an online customer scheduling-appointment system, are enhancing customer experience. Its online retailing initiative, the AcceleRide platform, is functional at most of the firm’s U.S. dealerships and is likely to aid its long-term prospects.
Buyouts of dealerships and franchises contribute to portfolio optimization. The 2021 acquisition of Prime Automotive in the Northeastern United States and the Robinsons Group in the UK, are set to contribute to the firm’s top-line growth. In 2021, Group 1 completed transactions representing $2.5 billion of acquired revenues.
Group 1’s investor-friendly moves instill optimism. It recently hiked its payout and boosted share repurchase program. GPI has a robust share repurchase program in place. Group 1’s return on equity (ROE) of 38.4% compares favorably with the industry’s 36% as well as the auto sector’s 10.3%, underscoring management's efficiency in rewarding shareholders.
Wabash National has an expected earnings growth rate of 238.7% for the current year. The Zacks Consensus Estimate for current-year earnings has been marginally revised around 0.5% upward in the past 30 days.
Wabash National’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters and missed in one. WNC pulled off a trailing four-quarter earnings surprise of 51.26%, on average. The stock has declined 6.6% over the past year.
Fox Factory has an expected earnings growth rate of 14.8% for the current year. The Zacks Consensus Estimate for current-year earnings has been revised around 1% upward in the past 30 days.
Fox Factory’s earnings beat the Zacks Consensus Estimate in all the trailing four quarters. FOXF pulled off a trailing four-quarter earnings surprise of 10.18%, on average. The stock has declined 48.7% over the past year.
Standard Motor has an expected earnings growth rate of 1.9% for the current year. The Zacks Consensus Estimate for current-year earnings has been revised 2.5% upward in the past 30 days.
Standard Motor’s earnings beat the Zacks Consensus Estimate in all the trailing four quarters. SMP pulled off a trailing four-quarter earnings surprise of 40.34%, on average. The stock has declined 15.1% over the past year.
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Here's Why You Should Buy Group 1 (GPI) Stock Right Now
Group 1 Automotive (GPI - Free Report) is benefiting from a diversified product mix, omni-channel efforts and acquisitions of dealerships and franchises.
We are positive about the company’s prospects and believe that the time is right for you to add the stock to your portfolio as it looks promising and is poised to carry the momentum ahead.
Let’s delve deeper into the factors that make this Zacks Rank #2 (Buy) stock an attractive choice for investors right now.
An Outperformer
Shares of Group 1 have rallied 14.6% in a year, exceeding the 6.4% rise of its industry. It has also outperformed the S&P 500’s 1.9% decline over the same period.
Image Source: Zacks Investment Research
Positive Earnings Surprise History
Group 1 has outpaced the Zacks Consensus Estimate in each of the trailing four quarters, delivering an earnings surprise of 6.63%, on average.
Estimates Going Up
Over the past two months, the Zacks Consensus Estimate for earnings has increased around 10.6% for the company. The consensus estimate for second-quarter 2022 has also been revised 5.4% upward over the same time frame. The favorable estimate revisions instill investors’ confidence in the stock.
Strong Growth Prospects
The Zacks Consensus Estimate for GPI’s 2022 earnings is currently pegged at $41.89, implying an expected year-over-year growth of 21.3%. Earnings are also expected to register a 2.4% rise in the second quarter.
Growth Drivers in Place
In the recently reported first quarter of 2022, sales in the company’s retail vehicle units, Parts and Service unit and Finance and Insurance unit saw robust growth. Revenues across the two business segments, the U.S. business and the U.K. business, also increased. The segmental revenue growth buoyed the firm’s top line which also rose 27.7% overall year over year.
A diversified product mix and multiple streams of income look to reduce GPI’s risk profile. The firm is dedicated to its omni-channel efforts to boost sales. Digitization initiatives, focused on an online customer scheduling-appointment system, are enhancing customer experience. Its online retailing initiative, the AcceleRide platform, is functional at most of the firm’s U.S. dealerships and is likely to aid its long-term prospects.
Buyouts of dealerships and franchises contribute to portfolio optimization. The 2021 acquisition of Prime Automotive in the Northeastern United States and the Robinsons Group in the UK, are set to contribute to the firm’s top-line growth. In 2021, Group 1 completed transactions representing $2.5 billion of acquired revenues.
Group 1’s investor-friendly moves instill optimism. It recently hiked its payout and boosted share repurchase program. GPI has a robust share repurchase program in place. Group 1’s return on equity (ROE) of 38.4% compares favorably with the industry’s 36% as well as the auto sector’s 10.3%, underscoring management's efficiency in rewarding shareholders.
Other Key Picks
Some other top-ranked players in the auto space include Wabash National Corporation (WNC - Free Report) , carrying a Zacks Rank #1 (Strong Buy), and Fox Factory Holdings (FOXF - Free Report) and Standard Motor Products (SMP - Free Report) , each carrying a Zacks Rank #2 currently. You can see the complete list of today’s Zacks #1 Rank stocks here.
Wabash National has an expected earnings growth rate of 238.7% for the current year. The Zacks Consensus Estimate for current-year earnings has been marginally revised around 0.5% upward in the past 30 days.
Wabash National’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters and missed in one. WNC pulled off a trailing four-quarter earnings surprise of 51.26%, on average. The stock has declined 6.6% over the past year.
Fox Factory has an expected earnings growth rate of 14.8% for the current year. The Zacks Consensus Estimate for current-year earnings has been revised around 1% upward in the past 30 days.
Fox Factory’s earnings beat the Zacks Consensus Estimate in all the trailing four quarters. FOXF pulled off a trailing four-quarter earnings surprise of 10.18%, on average. The stock has declined 48.7% over the past year.
Standard Motor has an expected earnings growth rate of 1.9% for the current year. The Zacks Consensus Estimate for current-year earnings has been revised 2.5% upward in the past 30 days.
Standard Motor’s earnings beat the Zacks Consensus Estimate in all the trailing four quarters. SMP pulled off a trailing four-quarter earnings surprise of 40.34%, on average. The stock has declined 15.1% over the past year.