Penske Automotive Group (NYSE:PAG) Hits New 52-Week High - Should You Buy?

Key Points

• Penske Automotive Group (NYSE:PAG) reached a new 52-week high of $186.46, trading with a volume of 126,781 shares.
• Brokerages have varying insights on the stock, with Bank of America increasing its price target from $190.00 to $205.00 and maintaining a "buy" rating.
• The company announced a quarterly dividend increase to $1.32 per share, representing a yield of 2.8%, and a stock buyback program authorizing $250 million in repurchases.

Penske Automotive Group, Inc. (NYSE:PAG - Get Free Report) shares reached a new 52-week high on Wednesday . The stock traded as high as $186.46 and last traded at $186.06, with a volume of 126781 shares traded. The stock had previously closed at $180.96.

Analyst Upgrades and Downgrades

A number of research analysts have weighed in on PAG shares. Bank of America boosted their target price on shares of Penske Automotive Group from $190.00 to $205.00 and gave the stock a "buy" rating in a research report on Monday, June 16th. Morgan Stanley reiterated an "overweight" rating and issued a $190.00 price objective (up previously from $180.00) on shares of Penske Automotive Group in a research report on Thursday. JPMorgan Chase & Co. upgraded shares of Penske Automotive Group from an "underweight" rating to a "neutral" rating and lifted their price target for the stock from $155.00 to $175.00 in a research note on Tuesday, August 5th. Stephens reissued an "equal weight" rating and issued a $140.00 target price on shares of Penske Automotive Group in a report on Wednesday, June 11th. Finally, Citigroup lifted their price target on shares of Penske Automotive Group from $185.00 to $195.00 and gave the company a "buy" rating in a report on Monday, May 19th. Two equities research analysts have rated the stock with a hold rating and five have issued a buy rating to the company. Based on data from MarketBeat.com, Penske Automotive Group has a consensus rating of "Moderate Buy" and a consensus target price of $181.00.

Penske Automotive Group Stock Up 0.6%

The company has a debt-to-equity ratio of 0.16, a quick ratio of 0.21 and a current ratio of 0.90. The firm's 50-day simple moving average is $174.36 and its two-hundred day simple moving average is $164.21. The stock has a market cap of $11.99 billion, a price-to-earnings ratio of 12.63 and a beta of 0.87.

Penske Automotive Group (NYSE:PAG - Get Free Report) last announced its quarterly earnings data on Wednesday, July 30th. The company reported $3.78 EPS for the quarter, topping analysts' consensus estimates of $3.56 by $0.22. Penske Automotive Group had a return on equity of 17.43% and a net margin of 3.13%. The firm had revenue of $7.66 billion during the quarter, compared to analyst estimates of $7.98 billion. During the same period last year, the company earned $3.61 earnings per share. The company's revenue was down .4% on a year-over-year basis. On average, sell-side analysts expect that Penske Automotive Group, Inc. will post 13.86 EPS for the current fiscal year.

Penske Automotive Group Increases Dividend

The company also recently declared a quarterly dividend, which will be paid on Wednesday, September 3rd. Investors of record on Friday, August 15th will be given a $1.32 dividend. The ex-dividend date is Friday, August 15th. This represents a $5.28 dividend on an annualized basis and a dividend yield of 2.9%. This is a positive change from Penske Automotive Group's previous quarterly dividend of $1.26. Penske Automotive Group's dividend payout ratio is 36.74%.

Penske Automotive Group announced that its board has authorized a stock buyback program on Wednesday, May 14th that permits the company to repurchase $250.00 million in outstanding shares. This repurchase authorization permits the company to repurchase up to 2.3% of its stock through open market purchases. Stock repurchase programs are typically an indication that the company's board believes its stock is undervalued.

Insider Transactions at Penske Automotive Group

In other Penske Automotive Group news, Director Greg C. Smith sold 1,529 shares of the stock in a transaction dated Tuesday, June 3rd. The stock was sold at an average price of $161.64, for a total value of $247,147.56. The sale was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through the SEC website. Also, CEO Roger S. Penske sold 77,357 shares of the firm's stock in a transaction that occurred on Tuesday, June 3rd. The stock was sold at an average price of $161.37, for a total transaction of $12,483,099.09. Following the sale, the chief executive officer owned 140,042 shares in the company, valued at $22,598,577.54. This trade represents a 35.58% decrease in their ownership of the stock. The disclosure for this sale can be found here. Insiders have sold a total of 82,044 shares of company stock valued at $13,257,948 over the last three months. 51.70% of the stock is currently owned by corporate insiders.

Hedge Funds Weigh In On Penske Automotive Group

A number of large investors have recently bought and sold shares of the company. Cambridge Investment Research Advisors Inc. grew its holdings in shares of Penske Automotive Group by 9.6% in the 1st quarter. Cambridge Investment Research Advisors Inc. now owns 3,367 shares of the company's stock valued at $485,000 after acquiring an additional 295 shares in the last quarter. Two Sigma Investments LP raised its stake in Penske Automotive Group by 21.0% in the 4th quarter. Two Sigma Investments LP now owns 10,253 shares of the company's stock valued at $1,563,000 after acquiring an additional 1,777 shares during the period. Teacher Retirement System of Texas increased its holdings in shares of Penske Automotive Group by 15.8% in the first quarter. Teacher Retirement System of Texas now owns 12,006 shares of the company's stock valued at $1,729,000 after purchasing an additional 1,639 shares during the last quarter. KBC Group NV raised its position in shares of Penske Automotive Group by 33.4% in the first quarter. KBC Group NV now owns 999 shares of the company's stock valued at $144,000 after purchasing an additional 250 shares during the period. Finally, SG Americas Securities LLC acquired a new stake in shares of Penske Automotive Group during the 1st quarter worth about $648,000. Institutional investors and hedge funds own 77.08% of the company's stock.

Penske Automotive Group Company Profile

Penske Automotive Group, Inc, a diversified transportation services company, operates automotive and commercial truck dealerships worldwide. The company operates through four segments: Retail Automotive, Retail Commercial Truck, Other, and Non-Automotive Investments. It operates dealerships under franchise agreements with various automotive manufacturers and distributors.