Penske Automotive Group (NYSE:PAG) Sets New 12-Month High - Time to 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)'s stock price reached a new 52-week high during mid-day trading on Wednesday . The stock traded as high as $186.46 and last traded at $186.06, with a volume of 126781 shares trading hands. The stock had previously closed at $180.96.

Analyst Upgrades and Downgrades

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

Penske Automotive Group Trading Down 1.5%

The firm's 50 day moving average price is $174.36 and its 200-day moving average price is $164.24. The stock has a market cap of $11.91 billion, a P/E ratio of 12.55 and a beta of 0.87. The company has a debt-to-equity ratio of 0.16, a current ratio of 0.90 and a quick ratio of 0.21.

Penske Automotive Group (NYSE:PAG - Get Free Report) last issued its quarterly earnings data on Wednesday, July 30th. The company reported $3.78 earnings per share for the quarter, beating analysts' consensus estimates of $3.56 by $0.22. The company had revenue of $7.66 billion for the quarter, compared to the consensus estimate of $7.98 billion. Penske Automotive Group had a net margin of 3.13% and a return on equity of 17.43%. The firm's revenue for the quarter was down .4% compared to the same quarter last year. During the same quarter in the prior year, the firm earned $3.61 earnings per share. As a group, equities research analysts forecast that Penske Automotive Group, Inc. will post 13.86 earnings per share for the current year.

Penske Automotive Group Increases Dividend

The business also recently disclosed a quarterly dividend, which will be paid on Wednesday, September 3rd. Investors of record on Friday, August 15th will be given a dividend of $1.32 per share. This represents a $5.28 dividend on an annualized basis and a yield of 2.9%. This is a positive change from Penske Automotive Group's previous quarterly dividend of $1.26. The ex-dividend date is Friday, August 15th. Penske Automotive Group's payout ratio is currently 35.07%.

Penske Automotive Group declared that its Board of Directors has authorized a share buyback plan on Wednesday, May 14th that authorizes the company to buyback $250.00 million in outstanding shares. This buyback authorization authorizes the company to buy up to 2.3% of its stock through open market purchases. Stock buyback plans are usually an indication that the company's leadership believes its shares are undervalued.

Insider Activity at Penske Automotive Group

In related news, Director Greg C. Smith sold 1,529 shares of the stock in a transaction that occurred on Tuesday, June 3rd. The shares were sold at an average price of $161.64, for a total transaction of $247,147.56. The sale was disclosed in a filing with the SEC, which is available at the SEC website. Also, CEO Roger S. Penske sold 77,357 shares of the 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 completion of the transaction, the chief executive officer owned 140,042 shares in the company, valued at $22,598,577.54. The trade was 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 worth $13,257,948 over the last quarter. Company insiders own 51.70% of the company's stock.

Institutional Inflows and Outflows

Several institutional investors have recently added to or reduced their stakes in PAG. Sound Income Strategies LLC purchased a new position in Penske Automotive Group during the second quarter valued at $34,000. Acadian Asset Management LLC purchased a new position in Penske Automotive Group during the first quarter valued at $42,000. UMB Bank n.a. grew its stake in Penske Automotive Group by 421.5% during the first quarter. UMB Bank n.a. now owns 339 shares of the company's stock valued at $49,000 after acquiring an additional 274 shares in the last quarter. GAMMA Investing LLC grew its stake in Penske Automotive Group by 51.9% during the first quarter. GAMMA Investing LLC now owns 398 shares of the company's stock valued at $57,000 after acquiring an additional 136 shares in the last quarter. Finally, Brooklyn Investment Group grew its stake in Penske Automotive Group by 353.0% during the first quarter. Brooklyn Investment Group now owns 453 shares of the company's stock valued at $65,000 after acquiring an additional 353 shares in the last quarter. 77.08% of the stock is currently owned by institutional investors.

About Penske Automotive Group

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.