Group 1 Automotive (GPI) Q2 Earnings Beat Estimates, Rise Y/Y

Group 1 Automotive GPI reported adjusted earnings per share of $3.77 in second-quarter 2020, beating the

Group 1 Automotive GPI reported adjusted earnings per share of $3.77 in second-quarter 2020, beating the Zacks Consensus Estimate of 91 cents. The bottom line also rose from the prior-year quarter’s $2.83 per share. Higher-than-expected revenues from new vehicles led to the outperformance.

Revenues of $2.13 billion fell 29.1% year over year. The top line, however, beat the Zacks Consensus Estimate of $2.06 billion.

Group 1 Automotive, Inc. Price, Consensus and EPS Surprise

 

Group 1 Automotive, Inc. Price, Consensus and EPS Surprise

Group 1 Automotive, Inc. price-consensus-eps-surprise-chart | Group 1 Automotive, Inc. Quote

Q2 Highlights

New-vehicle retail sales declined 32.1% from the prior-year quarter to $1.06 billion. However, the figure surpassed the Zacks Consensus Estimate of $1.04 billion. Used-vehicle sales fell 23.6% from the year-ago quarter to $641.2 million. The metric also missed the consensus mark of $794 million. For the Parts and Service business, the top line slumped 25.4% from a year ago to $282 million. It also missed the Zacks Consensus Estimate of $312 million. Revenues from the Finance and Insurance business were down 24% from the prior-year period to $96.7 million. It also missed the Zacks Consensus Estimate of $98 million.

Segments in Detail

Revenues in the U.S. business segment fell 19.6% year over year to $1.83 billion. The segment’s gross profit also dropped 13.9% year over year to $324.5 million. In the reported quarter, retail new-vehicle, used-vehicle, and wholesale used-vehicle units sold were 21,937, 26,132 and 5,150, respectively.

Revenues declined 57.1% year over year to $263.5 million for the U.K. business segment. Gross profit was $29.4 million, marking a 54.1% decrease from the second quarter of 2019. In the quarter under review, retail new-vehicle, used-vehicle, and wholesale used-vehicle units sold were 3,841, 4,040 and 1,829, respectively.

Revenues for the Brazil business segment slid 67.5% year over year to $36.6 million. Further, the segment’s gross profit declined 63.3% year over year to $4.9 million. In the reported quarter, retail new-vehicle, used-vehicle and wholesale used-vehicle units sold were 694, 356 and 324, respectively.

Financial Details

Group 1 Automotive’s cash and cash equivalents fell to $72.7 million as of Jun 30, 2020, from $23.8 million on Dec 31, 2019. Long-term debt was $1,360.7 million as of Jun 30, 2020, marking a decrease from $1,432.1 million recorded as of Dec 31, 2019.

Zacks Rank & Stocks to Consider

Currently, Group 1 Automotive carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the auto sector include AutoNation AN, Geely Automobile Holdings Ltd. GELYY and LCI Industries LCII. While AutoNation sports a Zacks Rank of 1(Strong Buy), Geely Automobile and LCI Industries carry a Zacks Rank of 2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Shares of AutoNation have rallied 8.8% year to date compared with the industry’s growthof 5.1%.

Shares of Geely Automobile have climbed 10.3% year to date against the industry’s decline of 15.7%.

Shares of LCI Industries have appreciated 22.1% year to date as against the industry’s decline of 8.3%.

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