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Penske Automotive (PAG) Outpaces Stock Market Gains: What You Should Know

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Penske Automotive (PAG - Free Report) closed at $103.73 in the latest trading session, marking a +0.64% move from the prior day. This change outpaced the S&P 500's 0.37% gain on the day.

Coming into today, shares of the auto dealership chain had gained 6.9% in the past month. In that same time, the Retail-Wholesale sector lost 0.05%, while the S&P 500 gained 2.13%.

Wall Street will be looking for positivity from PAG as it approaches its next earnings report date. This is expected to be October 27, 2021. On that day, PAG is projected to report earnings of $3.53 per share, which would represent year-over-year growth of 23%. Our most recent consensus estimate is calling for quarterly revenue of $6.46 billion, up 8.21% from the year-ago period.

PAG's full-year Zacks Consensus Estimates are calling for earnings of $13.38 per share and revenue of $25.55 billion. These results would represent year-over-year changes of +101.51% and +24.97%, respectively.

Investors should also note any recent changes to analyst estimates for PAG. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.07% higher. PAG is currently a Zacks Rank #2 (Buy).

Valuation is also important, so investors should note that PAG has a Forward P/E ratio of 7.71 right now. This valuation marks a discount compared to its industry's average Forward P/E of 8.47.

Also, we should mention that PAG has a PEG ratio of 0.52. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Automotive - Retail and Whole Sales industry currently had an average PEG ratio of 0.49 as of yesterday's close.

The Automotive - Retail and Whole Sales industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 4, which puts it in the top 2% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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