Group 1 Automotive To Leverage Higher Demand In US And UK Despite Pressured Margins: Analyst Forecasts
Portfolio Pulse from Nabaparna Bhattacharya
Benchmark analyst Michael P. Ward has reiterated a Buy rating on Group 1 Automotive, Inc. (NYSE:GPI), raising the price target to $340 from $300. Despite price volatility in the used vehicle market and below-trend demand in the new vehicle industry, GPI's margins have exceeded expectations. The company has added $1 billion in annual revenue from acquisitions and share repurchase reduced share count. The analyst expects the variable gross margins to decline over the next two years, but the performance will be above historical levels. The 2023 EPS estimate of GPI has been raised to $44.40 per share from $44.00, and the 2024 estimate has been increased to $44.35 from $44.25.

July 31, 2023 | 7:34 pm
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POSITIVE IMPACT
Group 1 Automotive's stock is expected to perform well due to the raised price target and positive analyst rating. Despite expected decline in gross margins, the performance is expected to be above historical levels.
The raised price target and positive analyst rating indicate a bullish outlook for Group 1 Automotive. Despite the expected decline in gross margins, the performance is expected to be above historical levels, which is a positive sign for the company's profitability. This could lead to an increase in the company's stock price in the short term.
CONFIDENCE 90
IMPORTANCE 80
RELEVANCE 100