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Investing.com - Benchmark initiated coverage on Group 1 Automotive Inc . (NYSE:GPI) with a hold rating on Tuesday.
The research firm cited limited upside potential following the stock’s strong year-to-date performance, applying target valuations of 8.5x AEBITDA and 11.5x EPS. Benchmark indicated it would remain on the sidelines amid an uncertain macroeconomic environment while awaiting a more attractive entry point.
Group 1 Automotive has expanded from 30 franchises since going public in 1997 to approximately 340 franchises across the United States and United Kingdom (TADAWUL:4280). The company recently completed its $2.7 billion Inchcape (OTC:INCPY) acquisition in the U.K., bringing its total merger and acquisition spending to approximately $3.5 billion since 2020.
Benchmark described Group 1 as a leading pure-play franchised auto retailer with a balanced brand portfolio and strong geographic exposure to high-growth markets, particularly Texas. The firm noted that integration of U.K. assets represents an opportunity for Group 1 to further improve its fundamental performance.
The research firm also highlighted management’s focus on core dealership operations and delivering consistent growth through disciplined and balanced capital allocation.
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