The 1Q25 EPS season is under way, launched, as usual by the earnings reports from the big banks. Next week, the floodgates will open with Consumer, Healthcare, and Industrial companies all releasing their quarterly results. Information Technology and Energy companies generally report later in the EPS period, and then the retailers wrap things up by late May. Consensus EPS estimates for 1Q25 growth range from low-single-digits to high-single-digits. This follows 17% growth in 4Q24 EPS and 9% growth in 3Q24, according to LSEG I/B/E/S. Leading sectors for 1Q25 are expected to be Healthcare (+38% EPS growth year over year) and Information Technology (+16%). Growth from the so-called Magnificent 7 is expected to outpace overall growth, as the group's earnings are forecast to grow 18%. On the downside, earnings from the Energy sector are expected to decline 15% and Materials 7%. Drilling down, revenue is expected to increase 4%, led by IT (+11%) and Healthcare (+4%). The balance of earnings growth will come from margin improvement and share buybacks. For 2025, our full-year earnings estimate is $276, implying low double-digit growth from 2024 level. Remember, companies generally exceed earnings expectations. Last quarter, three quarters of companies exceeded consensus expectations, compared to the historical average of 67%. Some complain that the U.S. SEC, by forcing companies to report quarterly profits, places too much emphasis on short-term results. But the system generates the most-transparent market in the world, as companies not only report results, but management teams also discuss those results and the outlook ahead. That's important today, when there is so much uncertainty over the direction of the global economy.

Penske Automotive Group operates in about 20 US states and overseas. It has over 150 US and Puerto Rico light-vehicle stores as well as 210 franchised dealerships overseas, primarily in the United Kingdom but also in Australia, Continental Europe, and Japan. The company is the third-largest US-based dealership in terms of light-vehicle revenue and sells more than 40 brands, with over 90% of retail automotive revenue coming from luxury and import names. Other segments are service and finance and insurance. The firm's Premier Truck Group owns 45 truck dealerships selling mostly Freightliner and Western Star brands, and Penske owns nearly 20 used-vehicle stores, mostly in the US and UK under the CarShop (US) and Sytner Select (UK) brands. Penske is based in Bloomfield Hills, Michigan.

Wells Fargo is one of the largest banks in the United States, with approximately $1.9 trillion in balance sheet assets. The company has four primary segments: consumer banking, commercial banking, corporate and investment banking, and wealth and investment management. It is almost entirely focused on the U.S.

As of October, Group 1 owns and operates 44 collision centers and 260 automotive dealerships in the US and the UK, offering 35 brands of automobiles altogether. About 150 of the stores are in the US with locations mostly in metropolitan areas in 17 states in the Northeast, Southeast, Midwest, and California. Texas alone contributed 38% of new-vehicle unit volume in 2023 and the UK about 19%. Texas, Oklahoma, and Massachusetts combined was 53%. Revenue in 2023 totaled $17.9 billion. The August, Inchcape UK deal adds about $2.7 billion of annual revenue and 54 stores to bring the UK store count to 114. Group 1 was founded in 1995 and is based in Houston.