Start here if you're new
what it is
Group 1 runs 335 car dealerships in the U.S. and U.K. and makes money selling cars, repairs, parts, and loan add-ons.
how it gets paid
Last year Automotive made $22.6B in revenue. new vehicle sales was the main engine at $11.3B, or 50% of sales.
why it's growing
Revenue grew 13.2% last year. Quarterly revenue was about $5.6B, while full-year revenue reached a record $22.6B.
what just happened
The latest quarter came in light, with $8.54 EPS versus the $9.56 analysts expected.
At a glance
B+ balance sheet — decent shape, but not bulletproof
65/100 earnings predictability — reasonably predictable
9.5x trailing p/e — the market's not buying it — or you found a deal
0.5% dividend yield — cash in your pocket every quarter
11.0% return on capital — nothing to write home about
xvary composite: 58/100 — below average
What they do
Group 1 runs 335 car dealerships in the U.S. and U.K. and makes money selling cars, repairs, parts, and loan add-ons.
This business wins with local scale. Group 1 has 335 dealerships, including 70 in Texas alone, so you keep seeing its lots, service bays, and brands. Dealer density → lots and repair shops close to your house → so what: when your car needs work, going back is easier than starting over.
How they make money
$22.6B
annual revenue · their business grew +13.2% last year
new vehicle sales
$11.3B
used vehicle sales
$7.5B
parts & services
$2.7B
finance & insurance
$0.9B
other / rounding
$0.2B
The products that matter
retail dealership operations
Automotive Dealerships
$22.6B revenue · +13.2% growth
it's the entire reported business. the data here is thin on segment detail, so you should read GPI first as one large dealership operator rather than a mix-shift story.
entire business
Key numbers
$45.30
fy2026 eps est
$26B
fy2028 rev est
9.5x
trailing p/e
0.5%
dividend yield
Financial health
B+
strength
- balance sheet grade B+ — solid but not elite
- risk rank 3 — safer than 50% of stocks
- price stability 55 / 100
- long-term debt $3.2B (39% of capital)
- net profit margin 2.8% — keeps 3 cents of every dollar in revenue
- return on equity 16% — $0.16 profit for every $1 investors have put in
B+ — functional but not a standout on the balance sheet.
Total return vs. market
You invested $10,000 in GPI 3 years ago → it's now worth $22,450.
The index would have given you $14,770.
source: institutional data · total return
What just happened
missed estimates
The latest quarter came in light, with $8.54 EPS versus the $9.56 analysts expected.
Quarterly revenue was about $5.6B, while full-year revenue reached a record $22.6B. There is noise in reported quarterly figures across sources, but the clean takeaway is simple: sales held up and profit missed.
$5.6B
revenue
$8.54
eps
16.2%
gross margin
the number that mattered
The 10.67% EPS miss mattered most because this stock is cheap only as long as earnings stay dependable.
-
group 1 automotive is switching things up.indeed, management recently announced that the houston-based auto dealer is ending its franchise agreement with jaguar land rover (jlr) in the united kingdom. among the reasons was a recent slowdown in sales, coinciding, in part, with the brand’s high cost of ownership. insuring vehicle makes like range rover has become very expensive in and around london, largely due to a high incidence of auto theft in the city.
-
management is mulling its options for those dealerships.
-
one scenario has group 1 rebranding them and partnering with other auto makers.
-
another has it selling the associated real estate and deploying the capital elsewhere.
-
that said, the transition isn’t happening overnight.
source: company earnings report, 2026
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What could go wrong
the #1 risk is vehicle margin compression across the dealership base.
med
vehicle gross margin pressure
GPI turned $22.6B of revenue into a 2.5% net margin. That leaves very little room for discounting, weaker used-car pricing, or softer store traffic.
When your profit pool is this thin, even modest pressure on pricing or volume matters fast.
med
franchise churn and store repositioning
The Jaguar Land Rover exit in the U.K. shows franchise relationships are not static. If more stores need to be rebranded or sold, you are underwriting execution risk, not just demand risk.
Store changes can improve returns over time, but they can also create dead periods where revenue stays on the books and profitability does not.
med
leverage in a cyclical business
Long-term debt sits at $3.2B, or 39% of capital. That is manageable in a normal market. It feels heavier if earnings soften at the same time vehicle demand does.
This is not a balance-sheet crisis today. It is a reminder that cyclicals lose flexibility faster than quality compounders do.
100% of the $22.6B revenue base depends on moving vehicles through low-margin stores, which means there is no high-margin segment waiting to bail out a weak cycle.
source: institutional data · regulatory filings · risk analysis
Pay attention to
metric
fy2026 EPS estimate
$45.30 is the number holding up the cheap valuation. If that estimate slips, the stock stops looking as inexpensive as 8.7x forward earnings suggests.
risk
vehicle margin pressure
With a 2.5% net margin, you do not need a collapse for earnings to feel it. Small pricing changes matter here.
calendar
store transition updates
Watch what management says about the former Jaguar Land Rover locations. Rebrand, sale, or delay all imply different capital outcomes.
trend
institutional flow
Three quarters of net selling is not fatal, but you want to see that trend stabilize before calling the stock a consensus bargain.
Analyst rankings
short-term outlook
average
momentum score 3 — in human-speak, analysts see a stock acting like the market, not breaking away from it.
risk profile
average
stability score 3 — neither a bunker stock nor a high-volatility mess.
chart momentum
top 20%
technical score 2 — the chart has been stronger than most, even if the business itself is still a cyclical retailer.
earnings predictability
65 / 100
predictable enough to underwrite, but not smooth enough to treat as a utility.
source: institutional data
Institutional activity
166 buyers vs. 226 sellers in 3q2025. total institutional holdings: 12.6M shares.
source: institutional data
Price targets
3-5 year target range
$327
$661
$396
current price
$494
target midpoint · +25% from current · 3-5yr high: $580 (+45% · 10% ann'l return)
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