Penske Automotive Group PAG reported fourth-quarter 2024 adjusted earnings of $3.54 per share, which increased 2.6% year over year and beat the Zacks Consensus Estimate of $3.37. Better-than-expected results from the Retail Automotive segment contributed to the outperformance. The company registered net sales of $7.72 billion, beating the Zacks Consensus Estimate of $7.56 billion. The top line rose 6.2% from the year-ago quarter's level.
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Penske’s gross profit in the reported quarter rose 6.1% on a year-over-year basis to $1.26 billion. The operating income expanded 25.6% to $333.8 million. Foreign currency exchange positively impacted revenues by $57 million, net income by $1 million and earnings per share (EPS) by 1 cent.
In the reported quarter, same-store retail units declined 2% year over year to 102,542. Within the Retail Automotive segment, same-store new-vehicle revenues were up 7.2% to $3.16 billion. Same-store used vehicle revenues increased 0.9% to $1.9 billion.
Penske Automotive Group, Inc. Price, Consensus and EPS Surprise
Penske Automotive Group, Inc. price-consensus-eps-surprise-chart | Penske Automotive Group, Inc. Quote
Segmental Performance
In the reported period, revenues in the Retail Automotive segment came in at $6.72 billion, which increased 8.8% from the year-ago quarter's level. The Zacks Consensus Estimate was $6.4 billion. Total new and used vehicle deliveries were up 0.1% year over year to 109,425 units. Gross profit of $1.08 billion rose 7.4% year over year and beat the consensus estimate of $1.05 billion.
Revenues in the Retail Commercial Truck segment decreased 14.5% to $774 million and lagged the consensus estimate of $968 million. Gross profit in the segment was $138.1 million, down from $143.2 million reported in the year-earlier quarter and fell short of the consensus mark of $150 million.
The Commercial Vehicle Distribution and Other segment’s revenues in the reported quarter increased 18.3% to $224 million and surpassed our estimate of $199 million. Gross profit came in at $45.8 million, which increased from $42.5 million reported in the year-ago period but fell shy of the consensus estimate of $46 million.
Financial Tidbits
In the quarter under review, SG&A costs totaled $886 million, up 6.1% year over year. As of Dec. 31, 2024, Penske had cash and cash equivalents of $72.4 million, down from $96.4 million as of Dec. 31, 2023. The long-term debt amounted to $1.13 billion, down from $1.42 billion as of Dec. 31, 2023.
During the quarter under discussion, PAG repurchased 0.4 million shares of common stock for $58.7 million. As of Sept. 30, 2024, $156.8 million of stock repurchase authorization remained outstanding.
Penske increased the dividend by 2.5% to $1.22 per share, to be paid out on March 6, 2025, to its shareholders of record as of Feb. 24, 2025. This marked the 17th consecutive quarterly increase in the payout.
Penske’s Zacks Rank & Key Picks
PAG currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the auto space are Dana DAN, Allison Transmission Holdings ALSN and Custom Truck One Source CTOS. While DAN sports a Zacks Rank #1 (Strong Buy) at present, ALSN and CTOS carry a Zacks Rank #2 (Buy) each. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for DAN’s 2025 earnings implies 79.17% growth on a year-over-year basis.
The Zacks Consensus Estimate for ALSN’s 2025 earnings implies 12.17% year-over-year growth.
The Zacks Consensus Estimate for CTOS’ 2025 earnings implies 75% year-over-year growth.
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