10 Best Car Repair Stocks to Buy Now

6. Group 1 Automotive, Inc. (NYSE:GPI)

Number of Hedge Fund Holders: 37

Group 1 Automotive, Inc. (NYSE:GPI) is a provider of used vehicles, parts, service and insurance contracts, and automotive maintenance and repair services. The company is based in Houston, Texas.

Company management in Group 1 Automotive, Inc.’s (NYSE:GPI) second-quarter earnings call noted that its main competitive advantage arises out of two qualities. First, Group 1 Automotive, Inc. (NYSE:GPI) has immense reach across two major markets, which gives it and its original equipment manufacturers (OEMs) competitive leverage and performance advantages. This has resulted in the company developing a robust relationship with its OEM partners, which is crucial for its future growth.

The second quality that sets Group 1 Automotive, Inc. (NYSE:GPI) apart from its competitors is its capital allocation strategy. It focuses on investing in and acquiring new vehicle franchise dealerships, and in 2024 alone, the company has acquired dealerships with expected revenues of $1.1 billion. Group 1 Automotive, Inc. (NYSE:GPI) also has the capabilities for effectively integrating these businesses into its existing portfolio, which will allow these transactions to be accretive from the first day.

An example of a successful acquisition can be found in Group 1 Automotive, Inc.’s (NYSE:GPI) purchase of four Mercedez-Benz dealerships in London, which increases its existing reach outside the US.

At the end of the second quarter, 37 hedge funds were long Group 1 Automotive, Inc. (NYSE:GPI), with a total stake value of $451.4 million.