Here's What to Expect from Group 1's (GPI) Q2 Earnings Release
Group 1 Automotive GPI is slated to release second-quarter 2023 results on Jul 26, before the opening bell. The Zacks Consensus Estimate for the to-be-reported quarter’s earnings and revenues is pegged at $11 per share and $4.43 billion, respectively.
The Zacks Consensus Estimate for second-quarter earnings per share has moved 9 cents north in the past seven days. The metric indicates a significant year-over-year decline of 8.33%. The consensus mark for quarterly revenues suggests year-over-year growth of 6.93%.
The auto retailer came up with better-than-expected results in the last reported quarter on the back of higher-than-anticipated revenues from all but the Financial/Insurance segment. In fact, Group 1 surpassed earnings estimates in the last four quarters, with the average being 9.71%. This is depicted in the graph below:
Group 1 Automotive, Inc. Price and EPS Surprise
Group 1 Automotive, Inc. price-eps-surprise | Group 1 Automotive, Inc. Quote
What Our Model Says
Our proven model does predicts an earnings beat for GPI this time around as well. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That is the case here. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.
Group 1 has an Earnings ESP of +2.85% and a Zacks Rank #2.
Factors to Consider
Improving inventory levels and strong demand for vehicles despite high costs of borrowing are likely to have aided sales of Group 1. Its AcceleRide platform — an online retailing initiative active at most of the firm’s U.S. dealerships — is expected to have buoyed second-quarter 2023 revenues.
Strategic buyouts during the quarter are expected to have enhanced GPI’s product portfolio and top line. In May, Group 1 bought three Beck & Masten Buick-GMC dealerships in Texas, including two high-volume dealerships in Houston and the highest-volume Buick-GMC dealership in Corpus Christi. This acquisition is likely to have added $760 million to the company’s annualized revenues. Last month, Group 1 acquired Beck & Masten Kia. This expanded GPI’s footprint to 15 brands and 18 dealerships in the Houston market and will add $85 million in its annualized sales.
Here's a sneak peek into our estimates for Group 1’s segmental revenues.
We project revenues from the new vehicle retail segment to be $1,975.4 million, implying an uptick from $1,851.3 million recorded in the corresponding period of 2022. Our estimate for GPI’s revenues from used vehicle unit is pegged at $1,615 million, suggesting growth of 0.9% from second-quarter 2022 reported numbers. Our projection for revenues of the Parts and Services segment is $558.7 million, suggesting an improvement from $502.6 million recorded in the year-ago period. Our forecast for revenues from GPI’s Financial/Insurance unit is pegged at $196.8 million, indicating growth of 3.5% from the year-ago quarter’s reported levels.
Other Stocks With Favorable Combination
Here are a few other stocks in the auto sector that are worth considering, as these have the right combination of elements to come up with an earnings beat this time around:
Oshkosh Corp OSK has an Earnings ESP of +10.58% and a Zacks Rank #1. The automotive parts provider is set to report results on Aug 1.
The Zacks Consensus Estimate for OSK’s to-be-reported quarter’s earnings and revenues is pegged at $1.62 per share and $2.24 billion, respectively. The consensus mark for second-quarter earnings per share has moved 2 cents north in the past 30 days.
Lear Corporation LEA has an Earnings ESP of +3.16% and a Zacks Rank #2. This manufacturer of automotive seating and electronic systems is slated to report results on Aug 1.
The Zacks Consensus Estimate for LEA’s to-be-reported quarter’s earnings and revenues is pegged at $3.05 per share and $5.72 billion, respectively. LEA surpassed earnings estimates in the last four quarters, with the average being 15.5%.
Rivian Automotive RIVN has an Earnings ESP of +6.25% and a Zacks Rank #2. The electric vehicle company is set to report results on Aug 8.
The Zacks Consensus Estimate for RIVN’s to-be-reported quarter’s bottom line and revenues is pegged at a loss of $1.42 per share and $932.3 million, respectively. RIVN surpassed earnings estimates in three of the last four quarters and missed in the other, with the average being 6.08%.
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Lear Corporation (LEA) : Free Stock Analysis Report
Group 1 Automotive, Inc. (GPI) : Free Stock Analysis Report
Oshkosh Corporation (OSK) : Free Stock Analysis Report
Rivian Automotive, Inc. (RIVN) : Free Stock Analysis Report
