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Group 1 (GPI) Acquires 4 Mercedes-Benz Dealerships in the UK

Zacks Equity Research
·2-min read

Group 1 Automotive, Inc. GPI, an international Fortune 300 automotive retailer, announced the expansion of its U.K. operations by acquiring four Mercedes-Benz dealerships in Hertfordshire, situated north of London, from L&L Automotive. These new locations are adjacent to several other dealerships that Group 1 already owns and operates in the United Kingdom. The locations are projected to sell more than 2,800 new and used vehicles annually. This acquisition is expected to generate $105 million in annual revenues, with new car sales registered as net revenues under the agency model.

Per Daryl Kenningham, CEO of Group 1, the addition of Mercedes-Benz dealerships into GPI’s portfolio offers the company an opportunity to enhance profitable growth for its shareholders.

In February 2024, Group 1 bought RRR Automotive, which is expected to add $500 million to its annual revenues. The same month, it bought two Lexus dealerships in South California, which is expected to add $350 million to the company’s annual revenues. The recent acquisition of Modern Classic Motors will add $140 million to its annual sales. Year to date, Group 1 has acquired around $1.1 billion of annual revenues.

With the upcoming acquisition of Inchcape U.K. dealerships, anticipated to close in the third quarter of 2024, the total acquired revenues are predicted to reach $3.8 billion at the time of closing.

Zacks Rank & Key Picks

GPI currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the auto space are Blue Bird Corporation BLBD, Geely Automobile Holdings Limited GELYY and American Axle & Manufacturing Holdings, Inc. AXL, each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

The consensus estimate for BLBD’s 2024 sales and earnings suggests year-over-year growth of 17.29% and 155.14%, respectively. The EPS estimates for 2024 and 2025 have improved 63 cents and 69 cents, respectively, in the past 60 days.

The Zacks Consensus Estimate for GELYY’s 2024 sales suggests year-over-year growth of 36.63%. The EPS estimates for 2024 and 2025 have improved 21 cents and 34 cents, respectively, in the past 60 days.

The Zacks Consensus Estimate for AXL’s 2024 sales and earnings suggests year-over-year growth of 3.05% and 544.44%, respectively. The EPS estimates for 2024 have moved up 5 cents in the past 60 days. The EPS estimates for 2025 have moved up 20 cents in the past 30 days.

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American Axle & Manufacturing Holdings, Inc. (AXL) : Free Stock Analysis Report

Group 1 Automotive, Inc. (GPI) : Free Stock Analysis Report

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Zacks Investment Research