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Penske (PAG) Hikes Dividend and Boosts Repurchase Program
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Penske Automotive Group, Inc. (PAG - Free Report) recently announced that it has increased its dividend to 50 cents per share from 47 cents, marking a 6.4% hike. During the first quarter of 2022, Penske generated $381 million in cash from operations. Driven by the strong cash flow, the company decided to hike the quarterly dividend.
The dividend is payable from Jun 1, 2022, to shareholders of record on May 23, 2022.
Moreover, it increased its share repurchase authorization to $250 million. From Jan 1 through Apr 30 of 2022, Penske repurchased 1.9 million shares worth $184.1 million. As of Apr 30, 2022, around $46.3 million remained available for repurchase under its existing share buyback authorization.
Penske’s investor-friendly moves boost confidence. In 2021, the company hiked its quarterly dividend four times. In January this year, the company increased its dividend by 2.2% to 47 cents. In 2021 PAG returned more than $436 million to shareholders through share repurchases ($293.5 million) and cash dividends ($142.5 million). The company's ROE of 35.3% compares favorably with the auto sector’s ROE of 12.6%, thus signaling management's efficiency in rewarding shareholders. Also, Penske’s debt-to-capitalization of 26% compares favorably with the industry’s 42%. In addition to the low leverage and lack of debt maturities anytime soon, it has more than $1.3 billion in liquidity.
Shares of Penske have gained 25.4% over the past year, outperforming its industry’s 1% growth.
Image Source: Zacks Investment Research
Zacks Rank & Other Key Picks
PAG currently carries a Zacks Rank #1 (Strong Buy).
AutoNation has an expected earnings growth rate of 21.4% for the current year. The Zacks Consensus Estimate for current-year earnings has been revised around 10% upward in the past 60 days.
AutoNation’s earnings beat the Zacks Consensus Estimate in all of the trailing four quarters. AN pulled off a trailing four-quarter earnings surprise of 27.4%, on average. The stock has gained 17.4% over the past year.
Asbury Automotive has an expected earnings growth rate of 28.3% for the current year. The Zacks Consensus Estimate for current-year earnings has been marginally revised 2.6% upwards in the past 60 days.
Asbury Automotive earnings beat the Zacks Consensus Estimate in all of the trailing four quarters and missed in one. ABG pulled off a trailing four-quarter earnings surprise of 22.9%, on average. The stock has lost 7% over the past year.
Group 1 has an expected earnings growth rate of 13.5% for the current year. The Zacks Consensus Estimate for current-year earnings has been revised around 4% upward in the past 60 days.
Group 1’s earnings beat the Zacks Consensus Estimate in all of the trailing four quarters. GPI pulled off a trailing four-quarter earnings surprise of 6.6%, on average. The stock has risen 9.9% over the past year.
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Penske (PAG) Hikes Dividend and Boosts Repurchase Program
Penske Automotive Group, Inc. (PAG - Free Report) recently announced that it has increased its dividend to 50 cents per share from 47 cents, marking a 6.4% hike. During the first quarter of 2022, Penske generated $381 million in cash from operations. Driven by the strong cash flow, the company decided to hike the quarterly dividend.
The dividend is payable from Jun 1, 2022, to shareholders of record on May 23, 2022.
Moreover, it increased its share repurchase authorization to $250 million. From Jan 1 through Apr 30 of 2022, Penske repurchased 1.9 million shares worth $184.1 million. As of Apr 30, 2022, around $46.3 million remained available for repurchase under its existing share buyback authorization.
Penske’s investor-friendly moves boost confidence. In 2021, the company hiked its quarterly dividend four times. In January this year, the company increased its dividend by 2.2% to 47 cents. In 2021 PAG returned more than $436 million to shareholders through share repurchases ($293.5 million) and cash dividends ($142.5 million). The company's ROE of 35.3% compares favorably with the auto sector’s ROE of 12.6%, thus signaling management's efficiency in rewarding shareholders. Also, Penske’s debt-to-capitalization of 26% compares favorably with the industry’s 42%. In addition to the low leverage and lack of debt maturities anytime soon, it has more than $1.3 billion in liquidity.
Shares of Penske have gained 25.4% over the past year, outperforming its industry’s 1% growth.
Image Source: Zacks Investment Research
Zacks Rank & Other Key Picks
PAG currently carries a Zacks Rank #1 (Strong Buy).
Some other top-ranked players in the auto space are AutoNation, Inc. (AN - Free Report) , sporting a Zacks Rank #1, and Asbury Automotive Group, Inc. (ABG - Free Report) and Group 1 Automotive, Inc. (GPI - Free Report) , each carrying a Zacks Rank #2 (Buy), currently. You can see the complete list of today’s Zacks #1 Rank stocks here.
AutoNation has an expected earnings growth rate of 21.4% for the current year. The Zacks Consensus Estimate for current-year earnings has been revised around 10% upward in the past 60 days.
AutoNation’s earnings beat the Zacks Consensus Estimate in all of the trailing four quarters. AN pulled off a trailing four-quarter earnings surprise of 27.4%, on average. The stock has gained 17.4% over the past year.
Asbury Automotive has an expected earnings growth rate of 28.3% for the current year. The Zacks Consensus Estimate for current-year earnings has been marginally revised 2.6% upwards in the past 60 days.
Asbury Automotive earnings beat the Zacks Consensus Estimate in all of the trailing four quarters and missed in one. ABG pulled off a trailing four-quarter earnings surprise of 22.9%, on average. The stock has lost 7% over the past year.
Group 1 has an expected earnings growth rate of 13.5% for the current year. The Zacks Consensus Estimate for current-year earnings has been revised around 4% upward in the past 60 days.
Group 1’s earnings beat the Zacks Consensus Estimate in all of the trailing four quarters. GPI pulled off a trailing four-quarter earnings surprise of 6.6%, on average. The stock has risen 9.9% over the past year.