GROUP 1 AUTOMOTIVE INC (GPI) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:GPI - US3989051095 - Common Stock
388.82 USD
-3.09 (-0.79%)
GPI gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 122 industry peers in the Specialty Retail industry. Both the profitability and the financial health of GPI get a neutral evaluation. Nothing too spectacular is happening here. GPI may be a bit undervalued, certainly considering the very reasonable score on growth
1. Profitability
1.1 Basic Checks
- In the past year GPI was profitable.
- GPI had a positive operating cash flow in the past year.
- GPI had positive earnings in each of the past 5 years.
- In the past 5 years GPI always reported a positive cash flow from operatings.
1.2 Ratios
- With a decent Return On Assets value of 3.57%, GPI is doing good in the industry, outperforming 61.48% of the companies in the same industry.
- Looking at the Return On Equity, with a value of 12.15%, GPI is in the better half of the industry, outperforming 68.03% of the companies in the same industry.
- GPI has a better Return On Invested Capital (8.28%) than 69.67% of its industry peers.
- Measured over the past 3 years, the Average Return On Invested Capital for GPI is in line with the industry average of 12.24%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.57% | ||
| ROE | 12.15% | ||
| ROIC | 8.28% |
ROA(3y)7.79%
ROA(5y)7.62%
ROE(3y)23.65%
ROE(5y)23.85%
ROIC(3y)11.08%
ROIC(5y)11.18%
1.3 Margins
- GPI has a Profit Margin of 1.65%. This is comparable to the rest of the industry: GPI outperforms 58.20% of its industry peers.
- In the last couple of years the Profit Margin of GPI has grown nicely.
- GPI's Operating Margin of 4.38% is fine compared to the rest of the industry. GPI outperforms 62.30% of its industry peers.
- GPI's Operating Margin has improved in the last couple of years.
- GPI's Gross Margin of 16.09% is on the low side compared to the rest of the industry. GPI is outperformed by 82.79% of its industry peers.
- In the last couple of years the Gross Margin of GPI has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 4.38% | ||
| PM (TTM) | 1.65% | ||
| GM | 16.09% |
OM growth 3Y-11.42%
OM growth 5Y7.66%
PM growth 3Y-14.84%
PM growth 5Y11.89%
GM growth 3Y-3.52%
GM growth 5Y1.52%
2. Health
2.1 Basic Checks
- GPI has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
- GPI has less shares outstanding than it did 1 year ago.
- GPI has less shares outstanding than it did 5 years ago.
- Compared to 1 year ago, GPI has a worse debt to assets ratio.
2.2 Solvency
- GPI has an Altman-Z score of 3.50. This indicates that GPI is financially healthy and has little risk of bankruptcy at the moment.
- The Altman-Z score of GPI (3.50) is better than 80.33% of its industry peers.
- The Debt to FCF ratio of GPI is 10.91, which is on the high side as it means it would take GPI, 10.91 years of fcf income to pay off all of its debts.
- With a Debt to FCF ratio value of 10.91, GPI perfoms like the industry average, outperforming 53.28% of the companies in the same industry.
- GPI has a Debt/Equity ratio of 1.69. This is a high value indicating a heavy dependency on external financing.
- With a Debt to Equity ratio value of 1.69, GPI is not doing good in the industry: 67.21% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.69 | ||
| Debt/FCF | 10.91 | ||
| Altman-Z | 3.5 |
ROIC/WACC0.93
WACC8.93%
2.3 Liquidity
- A Current Ratio of 1.06 indicates that GPI should not have too much problems paying its short term obligations.
- GPI's Current ratio of 1.06 is on the low side compared to the rest of the industry. GPI is outperformed by 69.67% of its industry peers.
- GPI has a Quick Ratio of 1.06. This is a bad value and indicates that GPI is not financially healthy enough and could expect problems in meeting its short term obligations.
- GPI's Quick ratio of 0.25 is on the low side compared to the rest of the industry. GPI is outperformed by 85.25% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.06 | ||
| Quick Ratio | 0.25 |
3. Growth
3.1 Past
- GPI shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 8.99%, which is quite good.
- GPI shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 29.17% yearly.
- GPI shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 19.45%.
- Measured over the past years, GPI shows a quite strong growth in Revenue. The Revenue has been growing by 10.60% on average per year.
EPS 1Y (TTM)8.99%
EPS 3Y3.87%
EPS 5Y29.17%
EPS Q2Q%5.56%
Revenue 1Y (TTM)19.45%
Revenue growth 3Y13.92%
Revenue growth 5Y10.6%
Sales Q2Q%10.75%
3.2 Future
- GPI is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 9.25% yearly.
- Based on estimates for the next years, GPI will show a small growth in Revenue. The Revenue will grow by 6.54% on average per year.
EPS Next Y7.44%
EPS Next 2Y6.45%
EPS Next 3Y8.02%
EPS Next 5Y9.25%
Revenue Next Year15.23%
Revenue Next 2Y9.1%
Revenue Next 3Y7.16%
Revenue Next 5Y6.54%
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
- The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- A Price/Earnings ratio of 9.21 indicates a reasonable valuation of GPI.
- GPI's Price/Earnings ratio is rather cheap when compared to the industry. GPI is cheaper than 89.34% of the companies in the same industry.
- GPI's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 27.21.
- A Price/Forward Earnings ratio of 8.74 indicates a reasonable valuation of GPI.
- 89.34% of the companies in the same industry are more expensive than GPI, based on the Price/Forward Earnings ratio.
- GPI's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 25.98.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.21 | ||
| Fwd PE | 8.74 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of GPI indicates a somewhat cheap valuation: GPI is cheaper than 70.49% of the companies listed in the same industry.
- GPI's Price/Free Cash Flow ratio is rather cheap when compared to the industry. GPI is cheaper than 86.07% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 9.96 | ||
| EV/EBITDA | 7.57 |
4.3 Compensation for Growth
- GPI's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
- The decent profitability rating of GPI may justify a higher PE ratio.
PEG (NY)1.24
PEG (5Y)0.32
EPS Next 2Y6.45%
EPS Next 3Y8.02%
5. Dividend
5.1 Amount
- With a yearly dividend of 0.50%, GPI is not a good candidate for dividend investing.
- GPI's Dividend Yield is a higher than the industry average which is at 2.15.
- With a Dividend Yield of 0.50, GPI pays less dividend than the S&P500 average, which is at 1.81.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.5% |
5.2 History
- The dividend of GPI is nicely growing with an annual growth rate of 11.18%!
- GPI has paid a dividend for at least 10 years, which is a reliable track record.
- GPI has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)11.18%
Div Incr Years4
Div Non Decr Years4
5.3 Sustainability
- 6.93% of the earnings are spent on dividend by GPI. This is a low number and sustainable payout ratio.
- GPI's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP6.93%
EPS Next 2Y6.45%
EPS Next 3Y8.02%
GROUP 1 AUTOMOTIVE INC / GPI FAQ
Can you provide the ChartMill fundamental rating for GROUP 1 AUTOMOTIVE INC?
ChartMill assigns a fundamental rating of 5 / 10 to GPI.
Can you provide the valuation status for GROUP 1 AUTOMOTIVE INC?
ChartMill assigns a valuation rating of 8 / 10 to GROUP 1 AUTOMOTIVE INC (GPI). This can be considered as Undervalued.
What is the profitability of GPI stock?
GROUP 1 AUTOMOTIVE INC (GPI) has a profitability rating of 6 / 10.
What are the PE and PB ratios of GROUP 1 AUTOMOTIVE INC (GPI) stock?
The Price/Earnings (PE) ratio for GROUP 1 AUTOMOTIVE INC (GPI) is 9.21 and the Price/Book (PB) ratio is 1.61.
How sustainable is the dividend of GROUP 1 AUTOMOTIVE INC (GPI) stock?
The dividend rating of GROUP 1 AUTOMOTIVE INC (GPI) is 5 / 10 and the dividend payout ratio is 6.93%.