It has been about a month since the last earnings report for Group 1 Automotive (GPI). Shares have added about 17.4% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Group 1 Automotive due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.

Group 1 Q3 Earnings Miss Expectations

Group 1 reported third-quarter adjusted earnings per share (EPS) of $9.90, which missed the Zacks Consensus Estimate of $9.93 and fell 18% year over year. The automotive retailer registered net sales of $5.22 billion, beating the Zacks Consensus Estimate of $5.14 billion. The top line also rose from the year-ago quarter’s $4.71 billion.

Quarter Highlights

New vehicle retail sales increased 13.4% from the prior-year quarter to $2.57 billion and exceeded our projection of $2.56 billion on the back of higher-than-expected volumes. Total retail new vehicles sold were 53,775 units, which increased 18.6% year over year and surpassed our forecast of 49,104 units. Average selling price per unit was $48,390, down 3.8% year over year. The gross profit from the new vehicle retail unit totaled $183.2 million, down 5.7% year over year.

Used-vehicle retail sales rose 6.2% from the year-ago period to $1.66 billion but missed our forecast of $1.68 billion. Total retail used vehicles sold were 55,907 units, up 10.1% year over year, exceeding our expectation of 53,919 units. The average selling price per unit came in at $29,630, down 3.5% year over year. The gross profit from the unit was $88 million, up 8.2% year over year.

Used-vehicle wholesale sales rose 7.4% year over year to $123.2 million but missed our expectation of $133.3 million. The unit recorded a gross profit of $0.4 million against the gross loss of $2.3 million in the year-ago period. In the Parts and Service business, the top line rose 16.4% from the year-ago quarter to $660 million and gross profit increased 17% year over year to $367 million. Revenues from the Finance and Insurance business came in at $214.1 million, up 7.4% from the year-ago period’s level.

Segments in Detail

In the reported quarter, revenues from the U.S. business segment rose 1.8% year over year to $3.97 billion but missed our forecast of $4.3 billion. The segment’s gross profit declined 0.7% to $678.1 million and fell short of our prediction of $705.2 million. During the reported quarter, retail new-vehicle, retail used-vehicle and wholesale used-vehicle units sold were 39,700, 38,775 and 9,577, respectively.

In the third quarter, revenues jumped 55.2% year over year to $1.25 billion for the U.K. business segment, beating our estimate of $893.1 million due to robust sales of new vehicles. Gross profit was $174.5 million, which surged 68.6% from the year-ago quarter and topped our projection of $108.1 million. During the reported quarter, the retail new-vehicle, retail used-vehicle and wholesale used-vehicle units sold were 14,075, 17,132 and 4,643, respectively.