Penske Automotive Group (NYSE:PAG) Hits New 1-Year High - Should You Buy?

Key Points

• Penske Automotive Group shares hit a new 52-week high, trading as high as $210.25 and closing above the prior day’s level amid notable volume.
• Analyst sentiment has improved, with multiple firms raising price targets or upgrading the stock; the consensus remains a Moderate Buy with an average target price of $194.62.
• The company recently topped quarterly earnings estimates and also increased its dividend to $1.42 per share, though insiders sold shares and the stock now yields about 2.6%.

Shares of Penske Automotive Group, Inc. (NYSE:PAG - Get Free Report) hit a new 52-week high during mid-day trading on Wednesday . The stock traded as high as $210.25 and last traded at $214.5520, with a volume of 37365 shares trading hands. The stock had previously closed at $195.19.

Analysts Set New Price Targets

Several research firms have recently weighed in on PAG. Weiss Ratings raised shares of Penske Automotive Group from a "hold (c+)" rating to a "buy (b-)" rating in a report on Friday, July 10th. Bank of America increased their price target on Penske Automotive Group from $200.00 to $238.00 and gave the stock a "buy" rating in a research report on Thursday, July 9th. Citigroup raised their price target on Penske Automotive Group from $193.00 to $199.00 and gave the company a "buy" rating in a report on Wednesday, May 6th. Stephens lifted their price objective on Penske Automotive Group from $155.00 to $160.00 and gave the company an "equal weight" rating in a research report on Monday, May 4th. Finally, Benchmark reissued a "buy" rating on shares of Penske Automotive Group in a research note on Friday, July 10th. Seven research analysts have rated the stock with a Buy rating and three have given a Hold rating to the stock. According to MarketBeat.com, the stock has a consensus rating of "Moderate Buy" and an average target price of $194.62.

Penske Automotive Group Price Performance

The company has a quick ratio of 0.22, a current ratio of 0.96 and a debt-to-equity ratio of 0.39. The stock's 50-day moving average price is $177.76 and its 200-day moving average price is $165.74. The company has a market capitalization of $14.31 billion, a price-to-earnings ratio of 16.12, a price-to-earnings-growth ratio of 2.53 and a beta of 0.87.

Penske Automotive Group (NYSE:PAG - Get Free Report) last issued its quarterly earnings results on Wednesday, April 29th. The company reported $3.05 earnings per share for the quarter, beating analysts' consensus estimates of $2.91 by $0.14. Penske Automotive Group had a net margin of 2.85% and a return on equity of 15.13%. The business had revenue of $7.86 billion during the quarter, compared to analyst estimates of $7.71 billion. During the same quarter last year, the business posted $3.66 earnings per share. Penske Automotive Group's revenue for the quarter was down 1.1% compared to the same quarter last year. Equities research analysts anticipate that Penske Automotive Group, Inc. will post 13.43 earnings per share for the current year.

Penske Automotive Group Increases Dividend

The company also recently announced a quarterly dividend, which was paid on Wednesday, June 3rd. Stockholders of record on Tuesday, May 26th were paid a $1.42 dividend. This is an increase from Penske Automotive Group's previous quarterly dividend of $1.40. The ex-dividend date of this dividend was Tuesday, May 26th. This represents a $5.68 annualized dividend and a dividend yield of 2.6%. Penske Automotive Group's payout ratio is 42.39%.

Insiders Place Their Bets

In related news, Director Greg C. Smith sold 1,488 shares of the firm's stock in a transaction dated Monday, May 18th. The stock was sold at an average price of $160.02, for a total value of $238,109.76. The transaction was disclosed in a legal filing with the SEC, which is accessible through this link. Also, CFO Michelle Hulgrave sold 1,500 shares of Penske Automotive Group stock in a transaction dated Tuesday, June 2nd. The stock was sold at an average price of $171.80, for a total value of $257,700.00. Following the completion of the sale, the chief financial officer owned 17,596 shares of the company's stock, valued at approximately $3,022,992.80. The trade was a 7.86% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Insiders own 52.90% of the company's stock.

Institutional Inflows and Outflows

Several hedge funds have recently modified their holdings of PAG. Victory Capital Management Inc. raised its stake in shares of Penske Automotive Group by 6.7% during the fourth quarter. Victory Capital Management Inc. now owns 1,484,075 shares of the company's stock worth $234,914,000 after buying an additional 92,794 shares during the last quarter. Dimensional Fund Advisors LP lifted its holdings in Penske Automotive Group by 11.9% in the first quarter. Dimensional Fund Advisors LP now owns 1,447,910 shares of the company's stock valued at $216,489,000 after buying an additional 154,443 shares during the period. Diamant Asset Management Inc. boosted its stake in Penske Automotive Group by 14,852.0% in the first quarter. Diamant Asset Management Inc. now owns 884,411 shares of the company's stock valued at $132,237,000 after acquiring an additional 878,496 shares during the last quarter. Bank of Montreal Can grew its holdings in Penske Automotive Group by 39,232.7% during the 4th quarter. Bank of Montreal Can now owns 863,352 shares of the company's stock worth $136,660,000 after acquiring an additional 861,157 shares during the period. Finally, AQR Capital Management LLC grew its holdings in Penske Automotive Group by 6.6% during the 3rd quarter. AQR Capital Management LLC now owns 726,490 shares of the company's stock worth $125,043,000 after acquiring an additional 44,749 shares during the period. Institutional investors own 77.08% of the company's stock.

Penske Automotive Group Company Profile

Penske Automotive Group, Inc NYSE: PAG, headquartered in Bloomfield Township, Michigan, is an international transportation services company primarily focused on automotive and commercial truck dealerships. The company retails new and pre-owned vehicles across a broad spectrum of brands, while offering parts, maintenance, collision repair and reconditioning services. In addition, Penske provides financing and insurance products through its integrated finance and insurance operations, supporting both retail customers and commercial clients.

Formed in 1990 as United Auto Group and publicly traded since 1999, Penske Automotive Group has grown through organic expansion and strategic acquisitions to establish a network of dealerships and service centers across the United States and Europe.

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