Contrasting Group 1 Automotive (NYSE:GPI) & MarineMax (NYSE:HZO)

Group 1 Automotive (NYSE:GPI) and MarineMax (NYSE:HZO) are both consumer discretionary companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, risk, valuation, dividends, analyst recommendations, institutional ownership and profitability.

Risk and Volatility

Group 1 Automotive has a beta of 0.82, suggesting that its stock price is 18% less volatile than the S&P 500. Comparatively, MarineMax has a beta of 1.66, suggesting that its stock price is 66% more volatile than the S&P 500.

Valuation & Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Group 1 Automotive	$22.57 billion	0.13	$325.20 million	$24.01	10.02
MarineMax	$2.31 billion	0.50	-$31.63 million	$0.14	373.54

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

Insider and Institutional Ownership

99.9% of Group 1 Automotive shares are owned by institutional investors. Comparatively, 92.8% of MarineMax shares are owned by institutional investors. 2.4% of Group 1 Automotive shares are owned by insiders. Comparatively, 3.2% of MarineMax shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Group 1 Automotive and MarineMax, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Group 1 Automotive	2	3	5	0	2.30
MarineMax	0	7	1	0	2.12

Group 1 Automotive currently has a consensus price target of $360.25, suggesting a potential upside of 49.70%. MarineMax has a consensus price target of $43.00, suggesting a potential downside of 17.77%. Given Group 1 Automotive’s stronger consensus rating and higher probable upside, equities research analysts clearly believe Group 1 Automotive is more favorable than MarineMax.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Group 1 Automotive	1.31%	15.66%	4.43%
MarineMax	0.18%	1.51%	0.59%

Summary

Group 1 Automotive beats MarineMax on 10 of the 14 factors compared between the two stocks.

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.

About MarineMax

MarineMax, Inc. operates as a recreational boat and yacht retailer and superyacht services company in the United States. It operates in two segments, Retail Operations and Product Manufacturing. The company sells new and used recreational boats, including pleasure and fishing boats, mega-yachts, yachts, sport cruisers, motor yachts, e-power yachts, pontoon boats, ski boats, jet boats, and other recreational boats. It also offers marine parts and accessories comprising marine electronics; dock and anchoring products that include boat fenders, lines, and anchors; boat covers; trailer parts; water sport accessories, which comprise tubes, lines, wakeboards, and skis; engine parts; oils; lubricants; steering and control systems; corrosion control products and service products; high-performance accessories, including propellers and instruments; and a line of boating accessories, such as life jackets, inflatables, and water sports equipment. In addition, the company provides novelty items, such as shirts, caps, and license plates; marine engines and equipment; maintenance, repair, and slip and storage services; and boat or yacht brokerage services, as well as yacht charters and power catamarans. Further, it offers new or used boat finance services; arranges insurance coverage, including boat property, disability, undercoating, gel sealant, fabric protection, trailer tire and wheel protection, and casualty insurance coverage; and manufactures and sells sport yachts and yachts. Additionally, the company operates MarineMax vacations in Tortola and British Virgin Islands. It also markets and sells its products through offsite locations and print catalog. MarineMax, Inc. was incorporated in 1998 and is based in Clearwater, Florida.