Critical Survey: Group 1 Automotive (NYSE:GPI) and FIGS (NYSE:FIGS)

FIGS (NYSE:FIGS) and Group 1 Automotive (NYSE:GPI) are both mid-cap consumer discretionary companies, but which is the better business? We will contrast the two companies based on the strength of their institutional ownership, earnings, valuation, profitability, dividends, risk and analyst recommendations.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for FIGS and Group 1 Automotive, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
FIGS	0	5	6	0	2.55
Group 1 Automotive	2	3	5	0	2.30

FIGS presently has a consensus price target of $18.71, indicating a potential upside of 44.23%. Group 1 Automotive has a consensus price target of $373.38, indicating a potential upside of 49.06%. Given Group 1 Automotive’s higher possible upside, analysts clearly believe Group 1 Automotive is more favorable than FIGS.

Institutional & Insider Ownership

92.2% of FIGS shares are held by institutional investors. Comparatively, 99.9% of Group 1 Automotive shares are held by institutional investors. 27.1% of FIGS shares are held by insiders. Comparatively, 2.4% of Group 1 Automotive shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares FIGS and Group 1 Automotive”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
FIGS	$710.08 million	3.04	$34.25 million	$0.33	39.32
Group 1 Automotive	$22.57 billion	0.13	$325.20 million	$24.01	10.43

Group 1 Automotive has higher revenue and earnings than FIGS. Group 1 Automotive is trading at a lower price-to-earnings ratio than FIGS, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

FIGS has a beta of 1.07, indicating that its share price is 7% more volatile than the S&P 500. Comparatively, Group 1 Automotive has a beta of 0.82, indicating that its share price is 18% less volatile than the S&P 500.

Profitability

This table compares FIGS and Group 1 Automotive’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
FIGS	8.72%	12.53%	9.52%
Group 1 Automotive	1.31%	15.66%	4.43%

Summary

FIGS beats Group 1 Automotive on 8 of the 14 factors compared between the two stocks.

About FIGS

FIGS, Inc. operates as a direct-to-consumer healthcare apparel and lifestyle company in the United States and internationally. It designs and sells healthcare apparel and scrubwear and non-scrubwear offerings, such as outerwear, underscrubs, footwear, compression socks, lab coats, loungewear, and other apparel. It also offers sports bras, performance leggings, tops, super-soft pima cotton tops, vests, fleeces, and jackets; necessities, scrub caps, lanyards, badge reels, tote bags, baseball caps, and beanies. The company markets and sells its products to healthcare professionals through its direct-to-consumer digital platform comprising website, mobile app, and B2B business, as well as retail store. FIGS, Inc. was founded in 2013 and is headquartered in Santa Monica, California. FIGS, Inc.

About Group 1 Automotive

Group 1 Automotive, Inc., through its subsidiaries, operates in the automotive retail industry in the United States and the United Kingdom. The company sells new and used cars, light trucks, and vehicle parts, as well as service and insurance contracts; arranges related vehicle financing; and offers automotive maintenance and repair services. Group 1 Automotive, Inc. was incorporated in 1995 and is headquartered in Houston, Texas.