Assessing Group 1 Automotive's (GPI) Valuation After Launching Innovative Mercedes-Benz Dealership and Confirming Dividend
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Aug 23 2025
0mins
Should l Buy GPI?
Source: Yahoo Finance
Upcoming Dealership Opening: Group 1 Automotive is set to open a new Mercedes-Benz dealership in South Austin, featuring an 80,000-square-foot facility and 28 EV charging stations, highlighting its commitment to luxury automotive retail.
Stock Performance: The company's shares have increased by 28% over the past year and 13% since January, indicating strong market performance and management's focus on expansion and customer experience.
Valuation Insights: Analysts suggest that Group 1 Automotive may be slightly undervalued based on community consensus, but a discounted cash flow model indicates potential overvaluation, raising questions about future growth expectations.
Investment Considerations: While there are opportunities for profit expansion through digital investments and improved efficiencies, challenges from competition and the shift to electric vehicles could impact the company's growth outlook.
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Analyst Views on GPI
Wall Street analysts forecast GPI stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for GPI is 481.25 USD with a low forecast of 435.00 USD and a high forecast of 510.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
5 Analyst Rating
4 Buy
1 Hold
0 Sell
Strong Buy
Current: 340.730
Low
435.00
Averages
481.25
High
510.00
Current: 340.730
Low
435.00
Averages
481.25
High
510.00
About GPI
Group 1 Automotive, Inc. is an automotive retailer. It operates through two segments: the U.S. and the U.K. Through its dealerships and omnichannel platform, the Company sells new and used cars and light trucks; arranges related vehicle financing; sells service and insurance contracts; provides automotive maintenance and repair services; and sells vehicle parts. It owns and operates about 263 automotive dealerships, 335 franchises, and 39 collision centers in the United States and the United Kingdom that offer 35 brands of automobiles. It sells retail used vehicles directly to its customers at its dealerships and via AcceleRide and wholesale its used vehicles at third-party auctions. Its operations are located in areas including Texas, Massachusetts, Oklahoma, California, Georgia, New Mexico, Maine, New Jersey, New Hampshire, Florida, South Carolina, Louisiana, Kansas, New York, Maryland, and others. It also offers third-party finance, vehicle service, and insurance products.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Group 1 Automotive Reports Record Q4 2025 Earnings and Strategic Acquisitions
- Record Revenue: Group 1 Automotive achieved an all-time high gross profit exceeding $3.6 billion in 2025, with parts and service gross profit nearing $1.6 billion, reflecting the company's relentless focus on operational excellence and expected to enhance market competitiveness.
- Sales and Acquisitions: The company sold 459,000 new and used vehicles in 2025 and acquired multiple dealerships in Florida and Texas, collectively anticipated to generate approximately $640 million in annual revenue, thereby strengthening its market share.
- Restructuring and Cost Control: The ongoing restructuring in the U.K. included a reduction of 537 positions and consolidation of customer contact centers, expected to improve aftersales performance by leveraging U.S. operational practices, thus enhancing overall profitability.
- Financial Performance and Outlook: In Q4, revenues reached $5.6 billion with a gross profit of $874 million and adjusted net income of $105 million, with management emphasizing continued focus on cost control and operational improvements to navigate near-term challenges while laying the groundwork for long-term growth.
See More
Group 1 Automotive Reports Higher Q4 Net Income
- Net Income Decline: Group 1 Automotive reported a net income of $43.1 million for Q4, down from $92.9 million last year, despite a slight revenue increase to $5.58 billion, indicating a significant drop in profitability.
- Earnings Per Share Drop: The company's earnings per share fell to $3.47 from $7.08 last year, missing analysts' expectations of $9.38, raising concerns about its financial health and market competitiveness.
- Operating Income Reduction: Operating income decreased to $139.3 million from $193.7 million year-over-year, highlighting challenges in cost management and operational efficiency that could impact future investment decisions.
- Market Reaction: In pre-market trading, Group 1 Automotive's stock price fell by 0.11% to $395.99 on the New York Stock Exchange, reflecting investor caution regarding the company's financial performance.
See More
Group 1 Automotive Reports Record Financial Results for 2025
- Significant Revenue Growth: Group 1 Automotive achieved total revenues of $22.6 billion in 2025, representing a 13.2% year-over-year increase, demonstrating the strength and resilience of its diversified business model and ongoing growth potential.
- Share Repurchase Strategy: The company repurchased 1.34 million shares in 2025, accounting for 10.1% of its outstanding shares, enhancing shareholder value and boosting market confidence through this strategy.
- Restructuring Charges Impact: Group 1 recognized $28.4 million in restructuring charges related to its UK restructuring plans in 2025, which are expected to further optimize operations and reduce costs, enhancing future profitability.
- Strong Performance Across Business Lines: The company achieved record gross profits in parts and service and finance and insurance (F&I), totaling $1.6 billion and $934.6 million respectively, reflecting its market leadership and profitability in these key areas.
See More
Group 1 Automotive Reports Record 2025 Financial Results
- Revenue Growth: Group 1 Automotive achieved total revenues of $22.6 billion for FY 2025, marking a 13.2% year-over-year increase, demonstrating strong performance across all business lines and reinforcing its market position.
- Gross Profit Increase: The company reported gross profits of $3.6 billion for FY 2025, an 11.8% increase, with parts and service gross profit reaching a record $1.6 billion, indicating ongoing growth potential in the service sector.
- Share Repurchase: In FY 2025, Group 1 repurchased approximately 10.1% of its outstanding shares, reflecting its commitment to enhancing shareholder value and driving returns through disciplined capital allocation.
- Quarterly Performance Volatility: The net income for Q4 2025 was $43 million, a 54.6% decline year-over-year, primarily due to non-cash asset impairment charges, highlighting challenges faced by the company amid market fluctuations.
See More
Group 1 Automotive Q4 Earnings Miss Expectations
- Earnings Performance: Group 1 Automotive reported a Q4 non-GAAP EPS of $8.49, missing expectations by $0.89, indicating pressure on profitability that could impact investor confidence.
- Revenue Growth Weakness: The company's Q4 revenue reached $5.58 billion, reflecting a 1.8% year-over-year increase, yet it fell short of market expectations by $70 million, highlighting a trend of slowing sales growth that may pose challenges for future performance.
- Dividend and Buyback Plans: Group 1 declared a $0.50 per share dividend and approved a new stock buyback program, aiming to enhance shareholder trust through capital returns, although the current financial performance is underwhelming, this move may help stabilize the stock price.
- Market Reaction Outlook: Given the earnings miss, the market is expected to adopt a cautious stance towards Group 1 Automotive's future performance, prompting investors to reassess the company's investment value in the automotive sector.
See More
Group 1 Automotive to Announce Q4 Earnings on January 29
- Earnings Announcement Date: Group 1 Automotive is set to release its Q4 earnings on January 29 before market open, with consensus EPS estimated at $9.38, reflecting a 6.4% year-over-year decline, while revenue is projected at $5.67 billion, indicating a 3.1% year-over-year increase, showcasing the company's resilience amid market fluctuations.
- Historical Performance: Over the past two years, Group 1 Automotive has exceeded EPS estimates 75% of the time and revenue estimates 100% of the time, demonstrating the company's reliability and execution in financial forecasting.
- Estimate Revision Dynamics: In the last three months, there have been no upward revisions to EPS estimates, with five downward adjustments, while revenue estimates saw three upward revisions and two downward, reflecting a cautious market outlook on the company's future performance.
- Shareholder Return Measures: Group 1 Automotive declared a $0.50 dividend per share and approved a new stock buyback plan, aimed at enhancing shareholder value and boosting market confidence.
See More
Group 1 Automotive Reports Record Q4 2025 Earnings and Strategic Acquisitions
- Record Revenue: Group 1 Automotive achieved an all-time high gross profit exceeding $3.6 billion in 2025, with parts and service gross profit nearing $1.6 billion, reflecting the company's relentless focus on operational excellence and expected to enhance market competitiveness.
- Sales and Acquisitions: The company sold 459,000 new and used vehicles in 2025 and acquired multiple dealerships in Florida and Texas, collectively anticipated to generate approximately $640 million in annual revenue, thereby strengthening its market share.
- Restructuring and Cost Control: The ongoing restructuring in the U.K. included a reduction of 537 positions and consolidation of customer contact centers, expected to improve aftersales performance by leveraging U.S. operational practices, thus enhancing overall profitability.
- Financial Performance and Outlook: In Q4, revenues reached $5.6 billion with a gross profit of $874 million and adjusted net income of $105 million, with management emphasizing continued focus on cost control and operational improvements to navigate near-term challenges while laying the groundwork for long-term growth.
See More
Group 1 Automotive Reports Higher Q4 Net Income
- Net Income Decline: Group 1 Automotive reported a net income of $43.1 million for Q4, down from $92.9 million last year, despite a slight revenue increase to $5.58 billion, indicating a significant drop in profitability.
- Earnings Per Share Drop: The company's earnings per share fell to $3.47 from $7.08 last year, missing analysts' expectations of $9.38, raising concerns about its financial health and market competitiveness.
- Operating Income Reduction: Operating income decreased to $139.3 million from $193.7 million year-over-year, highlighting challenges in cost management and operational efficiency that could impact future investment decisions.
- Market Reaction: In pre-market trading, Group 1 Automotive's stock price fell by 0.11% to $395.99 on the New York Stock Exchange, reflecting investor caution regarding the company's financial performance.
See More
Group 1 Automotive Reports Record Financial Results for 2025
- Significant Revenue Growth: Group 1 Automotive achieved total revenues of $22.6 billion in 2025, representing a 13.2% year-over-year increase, demonstrating the strength and resilience of its diversified business model and ongoing growth potential.
- Share Repurchase Strategy: The company repurchased 1.34 million shares in 2025, accounting for 10.1% of its outstanding shares, enhancing shareholder value and boosting market confidence through this strategy.
- Restructuring Charges Impact: Group 1 recognized $28.4 million in restructuring charges related to its UK restructuring plans in 2025, which are expected to further optimize operations and reduce costs, enhancing future profitability.
- Strong Performance Across Business Lines: The company achieved record gross profits in parts and service and finance and insurance (F&I), totaling $1.6 billion and $934.6 million respectively, reflecting its market leadership and profitability in these key areas.
See More
Group 1 Automotive Reports Record 2025 Financial Results
- Revenue Growth: Group 1 Automotive achieved total revenues of $22.6 billion for FY 2025, marking a 13.2% year-over-year increase, demonstrating strong performance across all business lines and reinforcing its market position.
- Gross Profit Increase: The company reported gross profits of $3.6 billion for FY 2025, an 11.8% increase, with parts and service gross profit reaching a record $1.6 billion, indicating ongoing growth potential in the service sector.
- Share Repurchase: In FY 2025, Group 1 repurchased approximately 10.1% of its outstanding shares, reflecting its commitment to enhancing shareholder value and driving returns through disciplined capital allocation.
- Quarterly Performance Volatility: The net income for Q4 2025 was $43 million, a 54.6% decline year-over-year, primarily due to non-cash asset impairment charges, highlighting challenges faced by the company amid market fluctuations.
See More
Group 1 Automotive Q4 Earnings Miss Expectations
- Earnings Performance: Group 1 Automotive reported a Q4 non-GAAP EPS of $8.49, missing expectations by $0.89, indicating pressure on profitability that could impact investor confidence.
- Revenue Growth Weakness: The company's Q4 revenue reached $5.58 billion, reflecting a 1.8% year-over-year increase, yet it fell short of market expectations by $70 million, highlighting a trend of slowing sales growth that may pose challenges for future performance.
- Dividend and Buyback Plans: Group 1 declared a $0.50 per share dividend and approved a new stock buyback program, aiming to enhance shareholder trust through capital returns, although the current financial performance is underwhelming, this move may help stabilize the stock price.
- Market Reaction Outlook: Given the earnings miss, the market is expected to adopt a cautious stance towards Group 1 Automotive's future performance, prompting investors to reassess the company's investment value in the automotive sector.
See More
Group 1 Automotive to Announce Q4 Earnings on January 29
- Earnings Announcement Date: Group 1 Automotive is set to release its Q4 earnings on January 29 before market open, with consensus EPS estimated at $9.38, reflecting a 6.4% year-over-year decline, while revenue is projected at $5.67 billion, indicating a 3.1% year-over-year increase, showcasing the company's resilience amid market fluctuations.
- Historical Performance: Over the past two years, Group 1 Automotive has exceeded EPS estimates 75% of the time and revenue estimates 100% of the time, demonstrating the company's reliability and execution in financial forecasting.
- Estimate Revision Dynamics: In the last three months, there have been no upward revisions to EPS estimates, with five downward adjustments, while revenue estimates saw three upward revisions and two downward, reflecting a cautious market outlook on the company's future performance.
- Shareholder Return Measures: Group 1 Automotive declared a $0.50 dividend per share and approved a new stock buyback plan, aimed at enhancing shareholder value and boosting market confidence.
See More
