HOUSTON - Group 1 Automotive, Inc. (NYSE:GPI), a leading automotive retailer, announced today its intention to offer $500 million in senior unsecured notes due in 2030, subject to market conditions. The company stated that the proceeds from the notes offering would be utilized to repay borrowings under its revolving credit facility and for general corporate purposes.
The notes, which will not be registered under the Securities Act of 1933 or any state securities laws, are to be offered to qualified institutional buyers by Rule 144A and to non-U.S. persons outside the United States in compliance with Regulation S.
Group 1 Automotive operates 206 dealerships, 270 franchises, and 42 collision centers in the U.S. and the U.K., selling new and used cars and light trucks, arranging vehicle financing, selling service and insurance contracts, providing maintenance and repair services, and selling vehicle parts.
This news is based on a press release statement from Group 1 Automotive, Inc.
In other recent news, Group 1 Automotive, a prominent automotive retailer, has triumphed over substantial challenges, including severe weather and a cyberattack, to report record revenues in new vehicle sales and finance & insurance for Q2 of 2024. The cyberattack on CDK systems affected the company's pre-tax income by an estimated $17 million. However, the company successfully navigated this crisis, serving customers through alternative processes.
In addition to overcoming these hurdles, Group 1 Automotive expanded its footprint by acquiring four Mercedes-Benz (OTC:MBGAF) dealerships and is expected to finalize the Inchcape (OTC:INCPY) acquisition in the next quarter, which will notably increase its UK market presence.
Supported by a robust balance sheet and liquidity of $644 million, the company has demonstrated its strategic approach to capital allocation, focusing on acquisitions, share repurchases, and dividends.
InvestingPro Insights
As Group 1 Automotive, Inc. (NYSE:GPI) prepares to issue $500 million in senior unsecured notes, investors may find it prudent to consider the company's financial health and market performance. According to InvestingPro data, Group 1 Automotive has a market capitalization of $4.26 billion and is trading at a favorable earnings multiple with a P/E ratio of 7.53. This indicates that the company's shares may be undervalued relative to its earnings, potentially offering an attractive entry point for investors. Additionally, with a Price/Book ratio of 1.54 as of the last twelve months up to Q2 2024, the company's market valuation aligns closely with its accounting value.
InvestingPro Tips suggest that Group 1 Automotive has demonstrated a commitment to shareholder returns, having raised its dividend for three consecutive years and maintained dividend payments for 15 consecutive years. Moreover, the company is trading near its 52-week high, with a price 96.36% of that peak, reflecting strong investor confidence. Nevertheless, two analysts have revised their earnings estimates downwards for the upcoming period, which warrants attention. It's also worth noting that Group 1 Automotive operates with a moderate level of debt, which could impact its financial flexibility.
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