NEW YORK (
-- Penske Automotive Group
) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, impressive record of earnings per share growth, compelling growth in net income and attractive valuation levels. We feel these strengths outweigh the fact that the company has had generally poor debt management on most measures that we evaluated.
Highlights from the ratings report include:
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Specialty Retail industry. The net income increased by 66.7% when compared to the same quarter one year prior, rising from $20.35 million to $33.93 million.
- PENSKE AUTOMOTIVE GROUP INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, PENSKE AUTOMOTIVE GROUP INC increased its bottom line by earning $1.25 versus $0.91 in the prior year. This year, the market expects an improvement in earnings ($1.48 versus $1.25).
- Powered by its strong earnings growth of 50.00% and other important driving factors, this stock has surged by 52.41% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, PAG should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- The revenue growth came in higher than the industry average of 4.0%. Since the same quarter one year prior, revenues rose by 15.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
Penske Automotive Group, Inc. operates as an automotive retailer in the United States and the United Kingdom. It sells new and used motor vehicles, as well as provides various repair, maintenance, and collision services. The company has a P/E ratio of 17, below the average specialty retail industry P/E ratio of 17.4 and equal to the S&P 500 P/E ratio of 17. Penske Automotive Group has a market cap of $1.9 billion and is part of the
industry. Shares are up 32.4% year to date as of the close of trading on Thursday.
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