COVID-19 Impact and Response - January and February results were strong, but March was significantly impacted by shelter-in-place orders in the U S and a complete shutdown in the U K [7] - U S service departments experienced a 40-50% decrease in customer traffic since mid-March [7] - The company is recalling furloughed employees in the U S and expects to add back approximately 500 U S employees by June [7] - Approximately 20% of vehicle purchases are now completed via home deliveries [13] Financial Performance and Metrics - The company's market capitalization was approximately $1 billion as of April 30, 2020 [16] - In Q1 2020, revenues were $2691 million, a 4 2% decrease compared to $2808 million in Q1 2019 [111] - Adjusted net income for Q1 2020 was $30 6 million, compared to $38 2 million in Q1 2019 [111] - Adjusted diluted earnings per share (EPCS) for Q1 2020 was $1 66, compared to $2 06 in Q1 2019 [111] Geographic and Business Diversity - The company has 186 dealerships worldwide, including 119 in the United States, 50 in the United Kingdom, and 17 in Brazil [18] - In Q1 2020, 69% of new vehicle unit sales were in the United States, 25% in the United Kingdom, and 6% in Brazil [18, 20] - Texas accounts for 35% of the company's geographic diversity in Q1 2020 [22] Strategic Initiatives - The company implemented an online retailing initiative across all dealerships as of December 31, 2019 [54] - Early April trends show a ~60% increase in daily leads for the Acceleride platform compared to January/February levels [54] - The company's U S year-over-year same store service advisor and technician headcount has grown by +11% as of December 31, 2019 [60]

Financial Performance & Growth - Group 1's adjusted EPS increased by 255% CAGR[8] - Group 1's adjusted FCF increased by 206% CAGR[8] - Group 1's revenue increased by 15% CAGR[8] - AcceleRide® total sales growth was +111% YoY in 2Q21[36] Business Strategy & Operations - Parts & Service generates approximately 45% of total gross profit[9] - Group 1 has immediate liquidity well over $700 million and a 17x rent-adjusted leverage ratio as of June 30, 2021[7] - Group 1 has acquired approximately $39 billion in annual revenues from 2014-2021 YTD[18] Geographic Footprint & Market - 40% of Group 1's 2Q21 total new vehicle unit sales are in Texas[15] - Group 1 operates 117 dealerships in the United States, 55 dealerships in the United Kingdom and 16 dealerships in Brazil[13]

Financial Performance & Growth - Adjusted Earnings Per Share (EPS) increased by 255% [8] - Revenue experienced a Compound Annual Growth Rate (CAGR) of over 15% [8] - Group 1 has never lost money on an operating basis in any quarter [12] - AcceleRide® achieved 68% growth in units sold year-over-year for 3Q21 [12] Business Strategy & Operations - Parts & Service generates approximately 45% of total gross profit [9] - The company has acquired approximately $41 billion in revenue through acquisitions from 2014 to YTD 2021 [20] - Approximately half of Group 1's vehicles sold utilized at least one component of the AcceleRide® platform during 3Q21 [34] Geographic Footprint & Market Position - Group 1 operates 120 dealerships in 15 states in the United States [13] - Texas accounts for 37% of 3Q21 total new vehicle unit sales [15] - As of September 30, 2021, the Company owns approximately $14 billion of net real estate, representing 61% of dealership locations [24]

COVID-19 Impact and Recovery - In the first half of April, the Company's vehicle sales and service businesses were down about 50%[5] - By the end of June, the Company's new vehicle sales had rebounded to a level approximately 15% below last year, but then stalled out due to inventory issues[5] - The flexibility of the business model allowed the Company to generate record operating profit despite ~30% decrease in total company second quarter revenues[5] - In April, the Company had furloughed 90% of its employees in the U K [6] - At the end of June, 50% of the Company's staff remained on furlough in the U K [6] Cost Management - Swift action was taken to furlough or lay off 4,800 U S employees (43% of headcount)[13] - Nearly $300 million of annualized U S SG&A reduction from 2Q19[13] - Adjusted SG&A as a % of Gross Profit decreased from 70% in 2Q19 to 59% in 2Q20[12] AcceleRide® Program - AcceleRide® sales have shown significant growth, with total online sales reaching 1,057 units in August 2020[58] - Click to Enter AcceleRide increased +43%, Credit App Submission increased +14%, and F&I Included increased +16% post-COVID[53] Financial Performance - Group 1 Automotive has a market cap of approximately $1 6 billion as of July 27, 2020[19] - The Company redeemed 5 25% bonds ($300 million face) on April 3[86] - The Company refinanced 5 00% bonds ($550 million face) with 4 00% bonds[87]

Financial Performance & Growth - Group 1's 2021 revenue reached $13802 million, a significant increase from $10852 million in 2020[9] - Adjusted EPS in 2021 was $3502, compared to $1806 in 2020, demonstrating substantial earnings growth[9] - Adjusted free cash flow for 2021 was $656 million, up from $426 million in 2020, highlighting strong cash generation[9] - From 2020 through 1Q22, the company repurchased approximately 15% of its outstanding common shares, totaling $4059 million[34] Strategic Initiatives & Market Position - Group 1 completed $25 billion in acquisitions in 2021 and $550 million year-to-date in 2022, indicating a focus on growth through strategic acquisitions[10] - The company's digital platform, AcceleRide®, experienced 77% year-over-year growth in units sold in FY21, showcasing the success of its digital retail strategy[10] - Parts & Service contributes approximately 45% of total gross profit, emphasizing its importance to the business model[28] - U S same store used retail units grew by 15% on a year-over-year basis in 2021, outperforming the industry[34] Geographic Focus - Texas locations generated 40% of 4Q21 total new vehicle unit sales, highlighting the importance of the Texas market[25] - Group 1 is the 1 auto retailer in Texas, capitalizing on the state's strong economic growth and business climate[27] Real Estate Strategy - As of December 31, 2021, Group 1 owned approximately $17 billion of gross real estate, representing 64% of dealership locations[37]

Core Insights - Used car prices are experiencing significant increases, with the Manheim Index rising 1.6% in June and a 6.3% year-over-year surge, the highest since August 2022 [1] - The increase in used car prices is attributed to Trump-era auto tariffs and a tightening supply of new vehicles, creating a demand for pre-owned cars [2][5] Market Dynamics - The uncertainty caused by proposed 25% tariffs on imported vehicles has led automakers to reduce production plans, resulting in a scarcity of new vehicles and increased demand for used cars [2] - Used vehicle inventory has dropped to a 43-day supply, significantly below normal levels, giving dealers increased pricing power and higher per-unit profits [3] Company Performance - Carvana and AutoNation are well-positioned to capitalize on the current market conditions due to their investments in online platforms and omnichannel sales strategies [4] - Carvana shares have increased over 74% year-to-date, while AutoNation has seen a nearly 26% rally, indicating strong investor interest and favorable margins [5] Investment Opportunities - The current pricing environment and expanding margins suggest that dealership stocks like Carvana and AutoNation may continue to perform well, providing a resilient investment opportunity amid tariff-related uncertainties in the new car market [5]

Core Viewpoint - Group 1 Automotive, Inc. is set to release its financial results for the second quarter of 2025 on July 24, 2025, before market opening, with a conference call scheduled for later that morning to discuss the results [1]. Group 1 Automotive Overview - Group 1 operates 259 automotive dealerships and 330 franchises across the U.S. and U.K., offering 36 brands of automobiles [3]. - The company provides a range of services including the sale of new and used cars, vehicle financing, service and insurance contracts, automotive maintenance and repair, and vehicle parts [3]. Conference Call Details - The conference call will be available via live simulcast on the internet and will have a replay available for 30 days [2]. - Participants can join the call by dialing in 10 minutes prior to the start, with specific numbers provided for domestic and international callers [2]. - A telephonic replay will be accessible until July 31, 2025, with designated numbers for domestic and international access [2].

Core Insights - Penske Automotive Group has acquired a Ferrari dealership in Modena, Italy, enhancing its luxury brand presence in the region to 29 automotive retail locations [1][2] - The new dealership is expected to generate annualized revenue of approximately $40 million [1] Company Overview - Penske Automotive Group, Inc. is a diversified international transportation services company with operations in eight countries and across four continents [2] - The company operates dealerships in various countries including the United States, United Kingdom, Canada, Germany, Italy, Japan, and Australia, and is a major retailer of commercial trucks in North America [2] - Penske Automotive employs over 28,700 people globally and holds a 28.9% stake in Penske Transportation Solutions, which manages a large fleet of over 428,000 trucks, tractors, and trailers [2]

Core Insights - True value in investments is derived from growth rather than short-term gains, emphasizing the importance of a long-term perspective [1] - Great businesses provide significant societal value and demonstrate durability, which is a key factor in their valuation [1] - Companies that offer products and services significantly superior to competitors are positioned for substantial growth [1] Group 1: Business Characteristics - Selection, convenience, and value are critical attributes sought in businesses [1] - Durability acts as a multiplier for value, with a preference for non-cyclical businesses [1] - The ability to innovate and maintain competitive advantages is essential for long-term success [1] Group 2: Revenue and Structure - Multiple revenue streams and anti-fragile business structures are preferred for resilience [1] - A business's ability to recover from adversity is a strong indicator of its durability [1] - Uniqueness is identified as the primary driver of value [1] Group 3: Management and Culture - Trust and network effects are vital for assessing a company's durability [1] - Management alignment with business interests and a focus on continuous learning are crucial for success [1] - Companies that empower employees and attract talent are more likely to thrive [1] Group 4: Investment Strategy - The best investment opportunities arise when negative news is already priced in, revealing true value [1] - Companies that can buy back shares during downturns are seen as having durable business models [1] - Price movements are influenced by expectations, with a focus on undervalued companies amidst negative sentiment [1]

Market Overview - The first half of 2025 experienced increased volatility and uncertainty due to President Trump's tariffs and a faster-than-expected cooling of inflation, leading to market recovery [1] - Recent months have shown favorable market conditions with easing trade tensions and a reduction in the Middle East crisis [1] Stock Performance and Recommendations - Optimism regarding artificial intelligence is expected to continue supporting stock prices, particularly in technology sectors [2] - Cooling inflation raises expectations for potential rate cuts starting in September 2025, contributing to a positive market outlook [2] - Stocks such as Cracker Barrel Old Country Store (CBRL), BGSF, ArcBest Corporation (ARCB), Cardinal Health (CAH), and AutoNation (AN) are recommended for monitoring as the second half of 2025 begins [2][6] Screening Strategy - A screening strategy has been developed to identify stocks based on improving broker recommendations and upward revisions in earnings estimates over the past four weeks [3] - The price/sales ratio is included as a valuation metric, focusing on companies with strong top-line performance [3] Screening Criteria - The top 75 companies with net upgrades in broker ratings over the last four weeks are identified [4] - The top 10 stocks with the highest percentage change in earnings estimates for the upcoming quarter are highlighted [4] - Companies in the bottom 10% of price-to-sales ratios are included for better valuation [4] Company Highlights - Cracker Barrel is focusing on menu innovation and pricing strategies to drive growth, introducing new offerings to attract customers [5] - BGSF has seen a 25% increase in shares over the past month and has a Zacks Rank 1, with earnings estimates rising over 300% in the last 60 days [7] - ArcBest is improving productivity and service quality, expecting a 52.1% increase in earnings per share for 2026 compared to 2025 [8] - Cardinal Health is undergoing strategic improvements to revitalize its business model, with its Medical segment expected to drive growth [9][10] - AutoNation's diversified product portfolio and strategic acquisitions support its market position, currently holding a Zacks Rank 3 [11]