How much a stock's price changes over time is important for most investors, since price performance can both impact your investment portfolio and help you compare investment results across sectors and industries.
The fear of missing out, or FOMO, also plays a factor in investing, especially with particular tech giants, as well as popular consumer-facing stocks.
What if you'd invested in Penske Automotive (
PAG Quick Quote PAG - Free Report) ten years ago? It may not have been easy to hold on to PAG for all that time, but if you did, how much would your investment be worth today? Penske Automotive's Business In-Depth
With that in mind, let's take a look at Penske Automotive's main business drivers.
Established in 1990, Penske Automotive Group, Inc., based in Bloomfield Hills, MI, engages in the operation of automotive and commercial truck dealerships in the United States, Canada and Western Europe. The company also distributes commercial vehicles, diesel engines, gas engines, power systems and related parts and services principally in Australia and New Zealand. It employs more than 23,000 people across the globe.
The company also offers higher margin products such as finance, insurance and vehicle service contracts; maintenance repair services; replacement parts and aftermarket automotive products.
Penske operates under three reportable segments, Retail Automotive, Commercial Truck and Commercial Vehicles Australia/Power Systems.
Retail Automotive which deals with retail automotive dealership operations generated 88% of revenues in 2021.
Commercial Truck, which consists of the U.S. retail commercial truck dealership operations generated 9.6% of the revenues in 2021. The company operates a heavy and medium-duty truck dealership group known as Premier Truck Group (PTG) with locations in Texas, Oklahoma, Tennessee, Georgia, and Canada.
Commercial Vehicles Australia/Power Systems and Other generated 2.4% of the revenues in 2021. The company is the exclusive importer and distributor of Western Star heavy-duty trucks (a Daimler brand), MAN heavy and medium-duty trucks and buses (a VW Group brand), and Dennis Eagle refuse collection vehicles.
In 2021, its retail automotive brand mix consisted of 71% Premium, 21% Volume non-U.S., 7% Car Shop Used-Vehicle Centers and 1% General Motors/Chrysler.
While anyone can invest, building a lucrative investment portfolio takes research, patience, and a little bit of risk. If you had invested in Penske Automotive ten years ago, you're probably feeling pretty good about your investment today.
A $1000 investment made in May 2012 would be worth $4,243.78, or a 324.38% gain, as of May 10, 2022, according to our calculations. Investors should note that this return excludes dividends but includes price increases.
The S&P 500 rose 194.65% and the price of gold increased 11.70% over the same time frame in comparison.
Analysts are anticipating more upside for PAG.
Shares of Penske have outperformed the industry and the sector over the past year. The company is riding high on strategic acquisitions. It has become the largest dealership group for Freightliner in North America with Warner Truck Centers buyout. Buyouts of Kansas City Freightliner, McCoy and Team Trucks Centers are boosting Penske’s top line. Notably, over the last 12 months, the company has completed acquisitions or opened new dealerships that would add $1.9 billion in annualized revenue. Penske Transportation Solutions (PTS) joint venture and acquisition of Black Horse Carriers are driving sales. Expansion of digital capabilities, balance sheet strength and investor-friendly moves are other positives. In the light of such tailwinds, Penske is viewed as an attractive bet and looks poised to maintain its bull run.
The stock has jumped 15.03% over the past four weeks. Additionally, no earnings estimate has gone lower in the past two months, compared to 2 higher, for fiscal 2022; the consensus estimate has moved up as well.