Goldman Sachs Raises GPI Estimates

Group 1 Automotive, Inc. (NYSE: GPI) 4Q10 EPS of $0.64 was slightly above “our expectation of $0.63 and the Street of $0.62,” Goldman Sachs reports.

“We are raising our 2011/2012 estimates to $3.61/$4.53 from $3.46/$4.25. We are also introducing our 2013E EPS estimate of $4.86,” Goldman Sachs writes.

“Our estimate changes reflect: a slightly lower level of profitability in new & used vehicles and P&S given the company's strategy to trade some margin for higher sales; and a modestly lower used to new ratio vs. our previous estimates.

“These factors are more than offset by higher top-line growth, driven by strong new volumes, higher growth in the P&S segment vis-à-vis our earlier forecast, and the impact of the mortgage facility restructuring that lowers interest expense by $3.8 mn.”

Group 1 Automotive closed Thursday at $39.00.