Group 1 Automotive, Inc. (GPI)
Valuation Overview•Is Group 1 Automotive, Inc. Overvalued or Undervalued?
Trading at a discount compared to peers, but the underlying intrinsic cash flows struggle to support the current price.
Fragile underlying quality score of 34/100; weak margins or elevated debt leverage warrant caution.
Analysts remain bullish, forecasting further upside expansion with consensus targets suggesting solid gains.
Verdict: Highly distressed profile flashing severe fundamental warning signs.
Wall Street is highly bullish, projecting significant upside alongside robust expected earnings growth. This outlook is strongly supported by highly attractive capital returns, driven predominantly by aggressive share repurchases.
GPI struggles with subpar profitability and pressured margins. However, this is severely offset by a highly leveraged balance sheet (Debt/EBITDA > 4.0x) and elevated financial risk.
The company demonstrates solid revenue growth (11.6% 3Y CAGR) however, earnings have severely contracted over the same period. However, profitability remains a major concern with severely compressed operating margins (4.3%).
| Financial Metric | Trend (12Q) | Latest Qtr | 1Y Growth | 3Y CAGR | 5Y CAGR | 10Y CAGR |
|---|---|---|---|---|---|---|
| Revenue | $5.4B | +13.2% | +11.6% | +16.3% | +7.8% | |
| EBITDA | $277.3M | — | -3.2% | — | — | |
| Net Income | $130.2M | -35.0% | -24.5% | — | +13.2% | |
| EPS (Diluted) | $10.74 | -31.6% | -18.9% | +10.1% | +20.6% | |
| Free Cash Flow | $8.4M | +24.4% | -0.5% | -9.6% | — |
| Metric | TTM | 3Y Avg | 5Y Avg | 10Y Avg |
|---|---|---|---|---|
| Gross Margin | 15.5% | 16.2% | 17.0% | 16.1% |
| Operating Margin | 4.3% | 4.7% | 5.5% | 4.4% |
| Net Margin | 1.5% | 2.4% | 3.2% | 2.5% |
| FCF Margin | 1.3% | 1.0% | 2.8% | 2.5% |
| Quarter | EPS Est. | EPS Act. | Surprise | EPS | Rev |
|---|---|---|---|---|---|
| Q2'26Latest | $8.82 | $8.66 | -1.8% | ||
| Q1'26 | $9.36 | $8.49 | -9.3% | ||
| Q4'25 | $10.64 | $10.45 | -1.8% | ||
| Q3'25 | $10.31 | $11.52 | +11.7% | ||
| Q2'25 | $9.72 | $10.17 | +4.6% | ||
| Q1'25 | $8.77 | $10.02 | +14.3% | ||
| Q4'24 | $9.87 | $9.90 | +0.3% | ||
| Q3'24 | $9.36 | $9.80 | +4.7% |
Total return is -28.2% (1Y), lagging the benchmark by -53.2%
| Period | Total Return | vs S&P 500 (Alpha) | Dividend Contribution |
|---|---|---|---|
| YTD | -20.0% | -29.3% | — |
| 1Y | -28.2% | -53.2% | +0.5% |
| 3YCAGR | +10.1% | -10.4% | +2.5% |
| 5YCAGR | +17.5% | +3.6% | +6.2% |
| 10YCAGR | +18.8% | +5.2% | — |
The S&P 500 is at 31.3x trailing P/E — Expensive relative to historical averages.
Quick answers to common questions about Group 1 Automotive, Inc. (GPI) valuation, health, and returns.
Group 1 Automotive, Inc. is estimated to be overvalued under our discounted cash flow framework. relative multiples indicate the stock is Slightly cheap versus peers compared to industry peers. overvalued (implying -20.7% downside from DCF intrinsic value of $248.46)
Group 1 Automotive, Inc. has multiple valuation anchors: DCF Intrinsic Value: $248.46 | Peer Relative Fair Value: $366.90 | Wall Street Analyst Target: $436.00 (implying +39.2% upside). A convergence of these signals offers higher conviction.
Group 1 Automotive, Inc. displays weak financial health with a composite quality score of 34/100, supported by a Altman Z-Score of 2.9 (grey zone), Piotroski F-Score of 6/9, Return on Invested Capital (ROIC) of 8.5%.
Group 1 Automotive, Inc. pays a 0.6% dividend yield, covered by a 8% payout ratio with 15 years of growth, supplemented by a 14.9% buyback yield.
Group 1 Automotive, Inc.'s current growth trajectory is Stable. The company achieved +13.2% 1Y revenue growth and -31.6% 1Y EPS growth, compared to its 3Y revenue CAGR of +11.6%.
Wall Street consensus is Buy based on 24 analysts, beating EPS expectations in 67% of recent quarters with a -3-quarter streak. The consensus price target represents a +39.2% change from current levels.
Investment risks for Group 1 Automotive, Inc. include: -39.1% 1-year max drawdown. Volatility risk is characterized by a beta of 0.74x.
No. These computations are purely quantitative model outputs for informational purposes. They do not account for qualitative management shifts or macro events. Always consult a licensed RIA before buying or selling shares.
Disclaimer: This page is for informational purposes only and does not constitute financial advice. All valuation models, scores, and target estimates are automated computations under stated assumptions and should not be relied upon as the sole basis for any investment decision.