Head to Head Survey: Group 1 Automotive (GPI) & Murphy USA (MUSA)

Group 1 Automotive (NYSE: GPI) and Murphy USA (NYSE:MUSA) are both retail/wholesale companies, but which is the better stock? We will contrast the two businesses based on the strength of their valuation, dividends, earnings, risk, profitability, analyst recommendations and institutional ownership.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Group 1 Automotive and Murphy USA, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Group 1 Automotive 1 7 1 0 2.00
Murphy USA 1 5 0 0 1.83

Group 1 Automotive presently has a consensus price target of $81.86, indicating a potential upside of 14.41%. Murphy USA has a consensus price target of $76.67, indicating a potential upside of 13.06%. Given Group 1 Automotive’s stronger consensus rating and higher possible upside, analysts clearly believe Group 1 Automotive is more favorable than Murphy USA.

Dividends

Group 1 Automotive pays an annual dividend of $1.04 per share and has a dividend yield of 1.5%. Murphy USA does not pay a dividend. Group 1 Automotive pays out 13.5% of its earnings in the form of a dividend. Group 1 Automotive has increased its dividend for 8 consecutive years.

Insider and Institutional Ownership

99.7% of Group 1 Automotive shares are owned by institutional investors. Comparatively, 89.2% of Murphy USA shares are owned by institutional investors. 5.0% of Group 1 Automotive shares are owned by company insiders. Comparatively, 8.1% of Murphy USA shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Profitability

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

Net Margins Return on Equity Return on Assets
Group 1 Automotive 1.86% 15.47% 3.43%
Murphy USA 2.20% 23.43% 7.19%

Volatility & Risk

Group 1 Automotive has a beta of 1.75, suggesting that its share price is 75% more volatile than the S&P 500. Comparatively, Murphy USA has a beta of 0.92, suggesting that its share price is 8% less volatile than the S&P 500.

Earnings & Valuation

This table compares Group 1 Automotive and Murphy USA’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 $11.12 billion 0.13 $213.44 million $7.73 9.26
Murphy USA $12.83 billion 0.18 $245.26 million $4.32 15.70

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

Summary

Murphy USA beats Group 1 Automotive on 9 of the 17 factors compared between the two stocks.

About Group 1 Automotive

Group 1 Automotive, Inc., through its subsidiaries, operates in the automotive retail industry. It sells new and used cars, light trucks, and vehicle parts; arranges vehicle financing; sells service and insurance contracts; and provides automotive maintenance and repair services. The company has operations primarily in the metropolitan areas of Alabama, California, Florida, Georgia, Kansas, Louisiana, Maryland, Massachusetts, Mississippi, New Hampshire, New Jersey, New Mexico, Oklahoma, South Carolina, and Texas in the United States; 28 towns in the United Kingdom; and in the metropolitan markets of Sao Paulo, Parana, Mato Grosso do Sul, and Santa Catarina, Brazil. As of February 15, 2018, it owned and operated 230 franchises, 175 dealership locations, and 48 collision centers that offer 32 brands of automobiles. The company was founded in 1995 and is headquartered in Houston, Texas.

About Murphy USA

Murphy USA Inc. operates a chain of retail stores in the United States. The company's retail stores offer motor fuel products and convenience merchandise. It operates retail stores under the Murphy USA and Murphy Express brand names. As of January 31, 2018, the company operated approximately 1,446 retail stores located primarily in the Southwest, Southeast, and Midwest United States. Murphy USA Inc. was incorporated in 2013 and is headquartered in El Dorado, Arkansas.

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