08:20 AM EDT, 04/24/2024 (MT Newswires) -- CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:
We maintain a 12-month price target of $275, based on a '25 P/E multiple of 7.0x, a justified discount to its 10-year average P/E of 8.2x. We lower our adjusted EPS estimates to $39.60 from $43.50 for '24 and to $39.50 from $42.30 for '25. GPI posts Q1 adjusted EPS of $9.53 vs. $10.91 (-13%), ahead of the $9.42 consensus. The beat was driven by a stronger-than-expected top line, as revenue rose 8% to $4.47B ($90M ahead of consensus) and gross margin contracted 100 bps to 16.6% (10 bps below consensus). GPI's vehicle sales volumes rose 12% for new and 8% for used vehicles. A lower share count helped boost EPS, as GPI repurchased 203K shares for $54M in Q1, but the company's pace of buybacks has slowed considerably in recent quarters. We remain at a Hold on lack of catalysts and concerns over interest rates. Notably, GPI's inventory levels remain well below average (only 37 days' supply for new vehicles and 30 days for used vehicles at the end of Q1), which could have a negative impact on near-term sales.