GrowGeneration (NASDAQ:GRWG – Get Free Report) and Group 1 Automotive (NYSE:GPI – Get Free Report) are both consumer discretionary companies, but which is the superior business? We will contrast the two businesses based on the strength of their dividends, institutional ownership, risk, earnings, profitability, analyst recommendations and valuation.
Analyst Recommendations
This is a breakdown of recent ratings and target prices for GrowGeneration and Group 1 Automotive, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| GrowGeneration | 1 | 1 | 1 | 0 | 2.00 |
| Group 1 Automotive | 3 | 2 | 5 | 0 | 2.20 |
GrowGeneration currently has a consensus target price of $2.50, indicating a potential upside of 70.07%. Group 1 Automotive has a consensus target price of $341.67, indicating a potential upside of 34.43%. Given GrowGeneration’s higher possible upside, analysts clearly believe GrowGeneration is more favorable than Group 1 Automotive.
Volatility & Risk
GrowGeneration has a beta of 2.54, meaning that its share price is 154% more volatile than the S&P 500. Comparatively, Group 1 Automotive has a beta of 0.92, meaning that its share price is 8% less volatile than the S&P 500.
Insider & Institutional Ownership
36.0% of GrowGeneration shares are owned by institutional investors. Comparatively, 99.9% of Group 1 Automotive shares are owned by institutional investors. 8.1% of GrowGeneration shares are owned by insiders. Comparatively, 2.4% of Group 1 Automotive shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Earnings & Valuation
This table compares GrowGeneration and Group 1 Automotive”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| GrowGeneration | $166.68 million | 0.52 | -$24.05 million | ($0.27) | -5.44 |
| Group 1 Automotive | $22.15 billion | 0.14 | $325.20 million | $24.01 | 10.59 |
Group 1 Automotive has higher revenue and earnings than GrowGeneration. GrowGeneration is trading at a lower price-to-earnings ratio than Group 1 Automotive, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares GrowGeneration and Group 1 Automotive’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| GrowGeneration | -10.07% | -17.44% | -11.52% |
| Group 1 Automotive | 1.31% | 15.66% | 4.43% |
Summary
Group 1 Automotive beats GrowGeneration on 10 of the 14 factors compared between the two stocks.
About GrowGeneration
GrowGeneration Corp., through its subsidiaries, owns and operates retail hydroponic and organic gardening stores in the United States. The company engages in the marketing and distribution of nutrients, additives, growing media, lighting, and environmental control systems, as well as other indoor and outdoor growing products. It operates a chain of stores in California, Colorado, Michigan, Maine, Oklahoma, Oregon, Washington, Montana, New York, Ohio, Mississippi, Missouri, Arizona, Rhode Island, Florida, Massachusetts, Virginia, New Jersey, and New Mexico, as well as growgeneration.com, an online superstore for cultivators, a wholesale business for resellers, HRG Distribution, and benching, racking, and storage solutions and MMI. The company was formerly known as Easylife Corp. GrowGeneration Corp. was founded in 2008 and is based in Greenwood Village, Colorado.
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.
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