Zacks Investment Research Lowers Group 1 Automotive (GPI) to Hold

Group 1 Automotive (NYSE:GPI) was downgraded by Zacks Investment Research from a “buy” rating to a “hold” rating in a report issued on Monday.

According to Zacks, “Of late, the Zacks Consensus Estimate for Group 1 Automotive’s quarterly earnings has been moving down. The company regularly acquires and divests dealerships and franchises to expand its business footprint. In the first-half of 2018, it acquired total 12 franchises with expected annual revenues of $405 million. Further, the company’s higher cash balance allows it to frequently engage in capital deployment strategies, which include share buybacks and dividend payments. However, Group 1 is experiencing a continuous rise in selling, general and administrative expenses, which is expected to hamper its margins. Also, uncertainty related to Brexit is impeding its new vehicle sales in the market. Over the past three months, shares of the company have underperformed the industry it belongs to.”

A number of other equities analysts have also recently commented on the company. ValuEngine cut Group 1 Automotive from a “sell” rating to a “strong sell” rating in a research note on Tuesday, October 2nd. Morgan Stanley lifted their price target on Group 1 Automotive from $59.00 to $64.00 and gave the stock a “sell” rating in a research note on Wednesday, August 15th. Finally, Stephens raised Group 1 Automotive from an “equal weight” rating to an “overweight” rating and set a $95.00 price target on the stock in a research note on Monday, August 6th. Two research analysts have rated the stock with a sell rating, four have assigned a hold rating and two have given a buy rating to the company. Group 1 Automotive has an average rating of “Hold” and a consensus target price of $84.33.

NYSE:GPI traded down $0.01 during mid-day trading on Monday, reaching $59.43. The stock had a trading volume of 9,478 shares, compared to its average volume of 265,521. The company has a market capitalization of $1.29 billion, a price-to-earnings ratio of 7.69, a PEG ratio of 4.44 and a beta of 1.96. Group 1 Automotive has a one year low of $58.32 and a one year high of $84.47. The company has a debt-to-equity ratio of 1.16, a current ratio of 1.07 and a quick ratio of 0.26.

Group 1 Automotive (NYSE:GPI) last announced its quarterly earnings results on Thursday, July 26th. The company reported $2.45 EPS for the quarter, topping the Zacks’ consensus estimate of $2.14 by $0.31. The business had revenue of $2.94 billion for the quarter, compared to analysts’ expectations of $2.92 billion. Group 1 Automotive had a return on equity of 15.73% and a net margin of 1.97%. The business’s quarterly revenue was up 10.2% on a year-over-year basis. During the same period in the previous year, the firm earned $1.87 EPS. As a group, sell-side analysts anticipate that Group 1 Automotive will post 8.92 EPS for the current year.

In other Group 1 Automotive news, VP Darryl M. Burman sold 4,000 shares of the business’s stock in a transaction on Wednesday, August 8th. The stock was sold at an average price of $78.00, for a total value of $312,000.00. Following the sale, the vice president now directly owns 64,178 shares of the company’s stock, valued at $5,005,884. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available at this hyperlink. Also, VP Darryl M. Burman sold 1,500 shares of the business’s stock in a transaction on Tuesday, August 21st. The stock was sold at an average price of $79.82, for a total value of $119,730.00. Following the completion of the sale, the vice president now directly owns 62,978 shares in the company, valued at $5,026,903.96. The disclosure for this sale can be found here. Insiders have sold 38,200 shares of company stock worth $3,012,805 over the last three months. Insiders own 4.95% of the company’s stock.

Several large investors have recently made changes to their positions in GPI. Vident Investment Advisory LLC lifted its holdings in Group 1 Automotive by 1.5% in the second quarter. Vident Investment Advisory LLC now owns 44,100 shares of the company’s stock valued at $2,778,000 after acquiring an additional 660 shares during the period. Rhumbline Advisers lifted its holdings in Group 1 Automotive by 1.5% in the second quarter. Rhumbline Advisers now owns 51,977 shares of the company’s stock valued at $3,275,000 after acquiring an additional 759 shares during the period. Municipal Employees Retirement System of Michigan lifted its holdings in Group 1 Automotive by 5.5% in the second quarter. Municipal Employees Retirement System of Michigan now owns 15,180 shares of the company’s stock valued at $957,000 after acquiring an additional 790 shares during the period. Flinton Capital Management LLC lifted its holdings in Group 1 Automotive by 74.4% in the second quarter. Flinton Capital Management LLC now owns 2,400 shares of the company’s stock valued at $151,000 after acquiring an additional 1,024 shares during the period. Finally, Meadow Creek Investment Management LLC lifted its holdings in Group 1 Automotive by 74.4% in the second quarter. Meadow Creek Investment Management LLC now owns 3,300 shares of the company’s stock valued at $208,000 after acquiring an additional 1,408 shares during the period. 99.76% of the stock is currently owned by hedge funds and other institutional investors.

About Group 1 Automotive

Group 1 Automotive, Inc, through its subsidiaries, operates in the automotive retail industry. It sells new and used cars, light trucks, and vehicle parts; arranges vehicle financing; sells service and insurance contracts; and provides automotive maintenance and repair services. The company has operations primarily in the metropolitan areas of Alabama, California, Florida, Georgia, Kansas, Louisiana, Maryland, Massachusetts, Mississippi, New Hampshire, New Jersey, New Mexico, Oklahoma, South Carolina, and Texas in the United States; 28 towns in the United Kingdom; and in the metropolitan markets of Sao Paulo, Parana, Mato Grosso do Sul, and Santa Catarina, Brazil.

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