Group 1 Automotive (NYSE:GPI – Get Free Report) and Ulta Beauty (NASDAQ:ULTA – Get Free Report) are both consumer discretionary companies, but which is the better stock? We will contrast the two companies based on the strength of their dividends, institutional ownership, risk, earnings, profitability, valuation and analyst recommendations.
Analyst Ratings
This is a summary of recent ratings and recommmendations for Group 1 Automotive and Ulta Beauty, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Group 1 Automotive | 3 | 2 | 5 | 0 | 2.20 |
| Ulta Beauty | 0 | 8 | 23 | 1 | 2.78 |
Group 1 Automotive currently has a consensus price target of $330.10, indicating a potential upside of 27.91%. Ulta Beauty has a consensus price target of $635.87, indicating a potential downside of 2.32%. Given Group 1 Automotive’s higher possible upside, research analysts clearly believe Group 1 Automotive is more favorable than Ulta Beauty.
Insider & Institutional Ownership
99.9% of Group 1 Automotive shares are owned by institutional investors. Comparatively, 90.4% of Ulta Beauty shares are owned by institutional investors. 2.4% of Group 1 Automotive shares are owned by company insiders. Comparatively, 0.2% of Ulta Beauty shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.
Profitability
This table compares Group 1 Automotive and Ulta Beauty’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Group 1 Automotive | 1.75% | 14.91% | 4.19% |
| Ulta Beauty | 9.34% | 45.40% | 17.37% |
Risk and Volatility
Group 1 Automotive has a beta of 0.96, suggesting that its share price is 4% less volatile than the S&P 500. Comparatively, Ulta Beauty has a beta of 0.83, suggesting that its share price is 17% less volatile than the S&P 500.
Valuation and Earnings
This table compares Group 1 Automotive and Ulta Beauty”s gross 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 | 0.14 | $325.20 million | $31.60 | 8.17 |
| Ulta Beauty | $12.39 billion | 2.25 | $1.15 billion | $27.44 | 23.72 |
Ulta Beauty has lower revenue, but higher earnings than Group 1 Automotive. Group 1 Automotive is trading at a lower price-to-earnings ratio than Ulta Beauty, indicating that it is currently the more affordable of the two stocks.
Summary
Ulta Beauty beats Group 1 Automotive on 9 of the 15 factors compared between the two stocks.
About Group 1 Automotive
Group 1 Automotive, Inc. is an international automotive retailer headquartered in Houston, Texas. Founded in 1997, the company operates franchised dealerships and collision centers in the United States and the United Kingdom. Its dealerships sell new and used vehicles from a range of manufacturers and provide related services, including vehicle maintenance and repair, parts sales, collision repair, and automotive financing and insurance products. Group 1’s business also includes manufacturer-authorized service operations and parts departments that support customers throughout vehicle ownership.
About Ulta Beauty
Ulta Beauty, Inc. is a specialty beauty retailer offering cosmetics, skincare, fragrance, haircare and related products. Its assortment includes both mass-market and prestige brands, as well as products sold under its own private-label brands. The company serves customers primarily through its retail stores across the United States and its e-commerce channels. Many stores also offer salon services, including haircuts, styling and hair color, alongside beauty products and services. Founded in 1990, Ulta Beauty is headquartered in Bolingbrook, Illinois.
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