Why Group 1 Automotive (GPI) is a Top Value Stock for the Long-Term

Taking full advantage of the stock market and investing with confidence are common goals for new and old investors alike.

Many investors also have a go-to methodology that helps guide their buy and sell decisions. One way to find winning stocks based on your preferred way of investing is to use the Zacks Style Scores, which are indicators that rate stocks based on three widely-followed investing types: value, growth, and momentum.

Finding good stocks at good prices, and discovering which companies are trading under their true value, are what value investors like to focus on. So, the Value Style Score takes into account ratios like P/E, PEG, Price/Sales, and Price/Cash Flow to highlight the most attractive and discounted stocks.

Group 1 Automotive, Inc. is one of the leading automotive retailers in the world, with operations primarily located in the United States and the U.K. The company's retail network consisted of 150 and 55 dealerships in the United States and the U.K., respectively. Through these dealerships, the firm sells new and used cars and light trucks. Apart from selling new and used vehicles, the company offers vehicle financing, insurance and service contracts. It also provides maintenance and repair services, along with the sale of replacement parts and aftermarket automotive products.

GPI is a Zacks Rank #3 (Hold) stock, with a Value Style Score of A and VGM Score of A. Shares are currently trading at a forward P/E of 11X for the current fiscal year compared to the Automotive - Retail and Whole Sales industry's P/E 11.3X. Additionally, GPI has a PEG Ratio of 1.2 and a Price/Cash Flow ratio of 9.6X. Value investors should also note GPI's Price/Sales ratio of 0.3X.

A company's earnings performance is important for value investors as well. For fiscal 2025, five analysts revised their earnings estimate higher in the last 60 days for GPI, while the Zacks Consensus Estimate has increased $1.32 to $42.23 per share. GPI also holds an average earnings surprise of 6.3%.

With strong valuation and earnings metrics, a good Zacks Rank, and top-tier Value and VGM Style Scores, investors should strongly think about adding GPI to their portfolios.

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This article originally published on Zacks Investment Research (zacks.com).

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