Hey friends! Happy Sunday and welcome to my post on fundamental analysis on
GPI
.
GPI
(Group 1 Inc) owns and operates 49 collision centers and 191 automotive dealerships across 248 franchises in the U.S., the U.K., and Brazil, offering 33 brands of automobiles altogether. U.S. locations are mostly in metropolitan areas in 15 states in the Northeast, Southeast, Midwest, and in California. Revenue in 2020 totaled $10.9 billion. The company was founded in 1995 and is based in Houston. The company is scheduled to buy 30 stores and three collision centers in New England from Prime in November, which was about the 20th largest U.S. auto dealer group and had $1.8 billion of 2020 revenue.
Disclaimer: This is for educational purposes on analyzing a company fundamentally and I personally don't hold the stock. All the methods of analyzing the company is completely free and mainly utilizes the financial indicators provided by Tradingview.
💲Profitability
GPI
has a steadily growing revenue and net income. The Earnings TTM is 361% higher than it was 5 years ago.
It has a ROE of 34% which is substantially higher than the industry median of 7.6%. Its ROA is 11% which is a lot higher than the industry median of 3.5% as well.
The company has an increasing net margin and sustainable growth rate.
We can see that the company is constantly buying back shares for the past 5 years.
Increasing Quality ratio ==> the company is becoming more and more efficient at generating income using its assets.
🏦Financial Strength
GPI
has a piotroski f-score of 8, which indicates that it is very strong financially.
We can back this up with the Altman Z-score which is in the safe zone, so it is safe to assume that the company is not in any financial distress.
The Debt/Equity ratio is steadily decreasing over the past few years.
The company is really profitable so it shouldn't be in any financial distress any time soon.
📈Valuation
GPI
is really undervalued and has a lot of room for growth in my opinion.
It has a PEG of 0.17 (less than one generally indicates that a company is extremely undervalued) which means that growth hasn't yet been priced into the stock, so the stock price has a lot of room to grow.
It also has a Tobin's Q score of 0.71 (less than one signifies a bargain since all of a company's securities could be purchased in the marketplace for less than the value of the company's real net assets) which further shows that it is extremely undervalued.
Its EV/EBITDA ratio (5.1) is a lot lower than the industry median of 9.23.
The P/E ratio is only 5.3 while the industry median is 16.69 which further proves that the company is extremely undervalued.
The stock price is under Graham's number which also shows that the company is undervalued.
🧑💼Management
We can safely assume that the company has a really good management team since it has clearly made a lot of efforts to improve the company's profitability and steadily bought back shares.
In conclusion the company seems really undervalued, really strong financially, has a good management team, and definitely has room to grow. This company is definitely a great value stock.
GPI
.
GPI
(Group 1 Inc) owns and operates 49 collision centers and 191 automotive dealerships across 248 franchises in the U.S., the U.K., and Brazil, offering 33 brands of automobiles altogether. U.S. locations are mostly in metropolitan areas in 15 states in the Northeast, Southeast, Midwest, and in California. Revenue in 2020 totaled $10.9 billion. The company was founded in 1995 and is based in Houston. The company is scheduled to buy 30 stores and three collision centers in New England from Prime in November, which was about the 20th largest U.S. auto dealer group and had $1.8 billion of 2020 revenue. Disclaimer: This is for educational purposes on analyzing a company fundamentally and I personally don't hold the stock. All the methods of analyzing the company is completely free and mainly utilizes the financial indicators provided by Tradingview.
💲Profitability
GPI
has a steadily growing revenue and net income. The Earnings TTM is 361% higher than it was 5 years ago. It has a ROE of 34% which is substantially higher than the industry median of 7.6%. Its ROA is 11% which is a lot higher than the industry median of 3.5% as well.
The company has an increasing net margin and sustainable growth rate.
We can see that the company is constantly buying back shares for the past 5 years.
Increasing Quality ratio ==> the company is becoming more and more efficient at generating income using its assets.
🏦Financial Strength
GPI
has a piotroski f-score of 8, which indicates that it is very strong financially. We can back this up with the Altman Z-score which is in the safe zone, so it is safe to assume that the company is not in any financial distress.
The Debt/Equity ratio is steadily decreasing over the past few years.
The company is really profitable so it shouldn't be in any financial distress any time soon.
📈Valuation
GPI
is really undervalued and has a lot of room for growth in my opinion. It has a PEG of 0.17 (less than one generally indicates that a company is extremely undervalued) which means that growth hasn't yet been priced into the stock, so the stock price has a lot of room to grow.
It also has a Tobin's Q score of 0.71 (less than one signifies a bargain since all of a company's securities could be purchased in the marketplace for less than the value of the company's real net assets) which further shows that it is extremely undervalued.
Its EV/EBITDA ratio (5.1) is a lot lower than the industry median of 9.23.
The P/E ratio is only 5.3 while the industry median is 16.69 which further proves that the company is extremely undervalued.
The stock price is under Graham's number which also shows that the company is undervalued.
🧑💼Management
We can safely assume that the company has a really good management team since it has clearly made a lot of efforts to improve the company's profitability and steadily bought back shares.
In conclusion the company seems really undervalued, really strong financially, has a good management team, and definitely has room to grow. This company is definitely a great value stock.