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Penske (PAG) Up More Than 2% Since Q1 Earnings & Sales Beat

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Penske Automotive Group’s (PAG - Free Report) shares have risen more than 2% since the company released first-quarter 2021 results on Apr 28, before the opening bell. The auto retailer reported adjusted earnings of $2.26 per share, increasing a whopping 253% year over year and surpassing the Zacks Consensus Estimate of $1.81. Markedly, higher-than-expected revenues and gross profit from the retail automotive unit — which accounts for bulk of the company’s overall top line — resulted in this outperformance.

The auto retailer registered net sales of $5,774 million, outpacing the Zacks Consensus Estimate of $5,497 million. The top-line figure also rose 15% from the comparable year-ago period.

The company’s gross profit for the reported quarter increased 17.6% on a year-over-year basis to $913.2 million. Operating income also jumped 106.4% from the prior-year period to $219.6 million.

For the March-end quarter, same-store retail unit sales increased 5.5% year over year to 110,137. Within the Retail Automotive segment, same-store new vehicle revenues rose 31.4% year on year to $2,414.8 million, while same-store used-vehicle revenues grew 12.4% to $1,795.1 million.

Segmental Performance

For the January-March period, revenues in the Retail Automotive segment came in at $5,206.9 million, increasing from $4,416.6 million in first-quarter 2020 and surpassing the Zacks Consensus Estimate of $4,864 million. Gross profit of $799.9 million compared favorably with $678.1 million reported in the year-ago quarter and topped the consensus mark of $668 million.

For the March-end quarter, revenues in the Retail Commercial Truck segment decreased to $434.7 million from the year-ago level of $491.4 million. Nonetheless, gross profit for the segment was $80 million, higher than the year-earlier level of $68.8 million.

Revenues in the Commercial Vehicles Australia/Power Systems and Other for the reported quarter increased 30.7% year over year to $132.2 million. Gross profit came in at $33.3 million compared with $29.8 million recorded in first-quarter 2020.

Financial Tidbits

For the quarter under review, SG&A costs totaled $664.3 million, up 3.5% year over year. Penske — whose peers include AutoNation (AN - Free Report) , Lithia Motors (LAD - Free Report) and Sonic Automotive (SAH - Free Report) — had cash and cash equivalents of $94.6 million as of Mar 31, 2021, up from $49.5 million at 2020-end. Long-term debt amounted to $1,492.5 million, down from $1,602.1 million as of Dec 31, 2020. The Zacks Rank #1 (Strong Buy) company has $171 million remaining under the current share-repurchase authorization. You can see the complete list of today’s Zacks #1 Rank stocks here.

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