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Penske (PAG) Q1 Earnings Mark 12th Straight Quarter of Beat
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Penske Automotive Group (PAG - Free Report) reported first-quarter 2023 adjusted earnings of $4.31 per share, which decreased 9% year over year but surpassed the Zacks Consensus Estimate of $4.03. Higher-than-expected gross profit in the Retail Automotive, Retail Commercial Truck and Commercial Vehicle Distribution and Other segments resulted in this outperformance. This marked the 12th consecutive earnings beat for the company.
The auto retailer registered net sales of $7,339 million, which topped the Zacks Consensus Estimate of $6,833 million. The top line rose 5.3% from the year-ago quarter.
Penske’s gross profit in the reported quarter increased 1.7% on a year-over-year basis to $1,252.3 million. The operating income went down 7.1% to $373.5 million. In the reported quarter, same-store retail units rose 4.8% year over year to 117,619. Within the Retail Automotive segment, same-store new-vehicle revenues were up 8.7% to $2,646.8 million. Same-store used-vehicle revenues fell 7.2% to $2,216.3 million.
In the reported period, revenues in the Retail Automotive segment came in at $6,299.8 million, increasing 4% from a year ago and topping the consensus mark of $5,646 million. Gross profit of $1,062.6 inched up 1% year over year came and came ahead of the consensus mark of $946 million.
Revenues in the Retail Commercial Truck segment increased 13% to $895.6 million but fell short of the consensus mark of $870 million. Gross profit in the segment was $147 million, rising from $141.2 million in the year-earlier quarter figure and topping the consensus mark of $123 million.
The Commercial Vehicle Distribution and Other segment’s revenues in the reported quarter decreased 6.6% to $143.6 million and lagged the consensus mark of $160 million. Gross profit came in at $42.7 million, up from $39.8 million in the year-ago period and higher than the Zacks Consensus Estimate of $36.46 million.
Financial Tidbits
In the quarter under review, SG&A costs totaled $844.9 million, up 5.9% year over year. Penske had cash and cash equivalents of $100.6 million as of Mar 31, 2023. The long-term debt amounted to $1,619.8 million, up from $1,546.9 million as of Mar 31, 2023. During the quarter under discussion, PAG repurchased 0.9 million shares of common stock for $110.2 million. In February, the company boosted its buyback program by an additional $250 million. As of Mar 31, 2023, $214.1 million of stock repurchase authorization remained outstanding.
Peer Releases
Lithia Motors (LAD - Free Report) reported first-quarter 2023 adjusted earnings of $8.44 per share, which decreased from the prior-year quarter’s $11.96. The bottom line also missed the Zacks Consensus Estimate of $8.64 per share. Lower-than-expected revenues from used vehicle retail, service, body and parts, finance and insurance and fleet and others segments caused the downslide. Total revenues jumped 4% year over year to $6,973.8 million but the top line lagged the Zacks Consensus Estimate of $7,063 million.
Cost of sales jumped 6.2% year over year in first-quarter 2023. SG&A expenses were $764.4 million, increasing 3.3% from $739.9 million in the year-ago quarter. Adjusted SG&A as a percentage of gross profit was 62.7%. Pretax and net profit margins declined from the year-ago levels. Lithia had cash/cash equivalents/restricted cash of $299.4 million as of Mar 31, 2023, up from $246.7 million as of Dec 31, 2022. Long-term debt was $5,066 million as of Mar 31, 2023, down from $5088.3 million as of Dec 31, 2022.
AutoNation, Inc. (AN - Free Report) reported first-quarter 2023 adjusted earnings of $6.05 per share, which increased 4.6% year over year and topped the Zacks Consensus Estimate of $5.96. This outperformance can be primarily attributed to the higher-than-expected income across Domestic, Import and Premium Luxury segments. In the reported quarter, revenues amounted to $6,398.7 million, shrinking 5% year over year and missing the Zacks Consensus Estimate of $6,683 million.
Adjusted SG&A expenses, as a percentage of gross profit, were 60.8%, deteriorating 4.4 percentage points from the year-ago period. Expenses rose to $782.7 million from $741.4 million in the year-ago quarter. AutoNation’s cash and cash equivalents were $58.3 million as of Mar 31, 2023, declining from $72.6 million recorded as of Dec 31, 2022. The company’s liquidity was $1.6 billion, including $58 million in cash and nearly $1.5 billion available under its revolving credit facility.
Group 1 Automotive (GPI - Free Report) reported first-quarter 2023 adjusted earnings per share of $10.93, which beat the Zacks Consensus Estimate of $9.70. The outperformance can be attributed to higher-than-anticipated revenues from all but the Financial/Insurance segment. The bottom line increased from the prior-year quarter’s $10.81 per share. The automotive retailer registered net sales of $4,130 million, beating the Zacks Consensus Estimate of $3,921 million. Also, the top line rose 7.4% from the year-ago quarter’s $3,844.4 million.
Selling, general and administrative expenses were up 10.6% year over year to $462.8 million. Group 1 Automotive had cash and cash equivalents of $21.3 million as of Mar 31, 2023, down from $47.9 million as of 2022-end. Total debt was $1,988.5 million as of Mar 31, 2023, down from $2,082.5 million recorded on Dec 31, 2022.
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Penske (PAG) Q1 Earnings Mark 12th Straight Quarter of Beat
Penske Automotive Group (PAG - Free Report) reported first-quarter 2023 adjusted earnings of $4.31 per share, which decreased 9% year over year but surpassed the Zacks Consensus Estimate of $4.03. Higher-than-expected gross profit in the Retail Automotive, Retail Commercial Truck and Commercial Vehicle Distribution and Other segments resulted in this outperformance. This marked the 12th consecutive earnings beat for the company.
The auto retailer registered net sales of $7,339 million, which topped the Zacks Consensus Estimate of $6,833 million. The top line rose 5.3% from the year-ago quarter.
Penske’s gross profit in the reported quarter increased 1.7% on a year-over-year basis to $1,252.3 million. The operating income went down 7.1% to $373.5 million. In the reported quarter, same-store retail units rose 4.8% year over year to 117,619. Within the Retail Automotive segment, same-store new-vehicle revenues were up 8.7% to $2,646.8 million. Same-store used-vehicle revenues fell 7.2% to $2,216.3 million.
PAG has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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 $6,299.8 million, increasing 4% from a year ago and topping the consensus mark of $5,646 million. Gross profit of $1,062.6 inched up 1% year over year came and came ahead of the consensus mark of $946 million.
Revenues in the Retail Commercial Truck segment increased 13% to $895.6 million but fell short of the consensus mark of $870 million. Gross profit in the segment was $147 million, rising from $141.2 million in the year-earlier quarter figure and topping the consensus mark of $123 million.
The Commercial Vehicle Distribution and Other segment’s revenues in the reported quarter decreased 6.6% to $143.6 million and lagged the consensus mark of $160 million. Gross profit came in at $42.7 million, up from $39.8 million in the year-ago period and higher than the Zacks Consensus Estimate of $36.46 million.
Financial Tidbits
In the quarter under review, SG&A costs totaled $844.9 million, up 5.9% year over year. Penske had cash and cash equivalents of $100.6 million as of Mar 31, 2023. The long-term debt amounted to $1,619.8 million, up from $1,546.9 million as of Mar 31, 2023. During the quarter under discussion, PAG repurchased 0.9 million shares of common stock for $110.2 million. In February, the company boosted its buyback program by an additional $250 million. As of Mar 31, 2023, $214.1 million of stock repurchase authorization remained outstanding.
Peer Releases
Lithia Motors (LAD - Free Report) reported first-quarter 2023 adjusted earnings of $8.44 per share, which decreased from the prior-year quarter’s $11.96. The bottom line also missed the Zacks Consensus Estimate of $8.64 per share. Lower-than-expected revenues from used vehicle retail, service, body and parts, finance and insurance and fleet and others segments caused the downslide. Total revenues jumped 4% year over year to $6,973.8 million but the top line lagged the Zacks Consensus Estimate of $7,063 million.
Cost of sales jumped 6.2% year over year in first-quarter 2023. SG&A expenses were $764.4 million, increasing 3.3% from $739.9 million in the year-ago quarter. Adjusted SG&A as a percentage of gross profit was 62.7%. Pretax and net profit margins declined from the year-ago levels. Lithia had cash/cash equivalents/restricted cash of $299.4 million as of Mar 31, 2023, up from $246.7 million as of Dec 31, 2022. Long-term debt was $5,066 million as of Mar 31, 2023, down from $5088.3 million as of Dec 31, 2022.
AutoNation, Inc. (AN - Free Report) reported first-quarter 2023 adjusted earnings of $6.05 per share, which increased 4.6% year over year and topped the Zacks Consensus Estimate of $5.96. This outperformance can be primarily attributed to the higher-than-expected income across Domestic, Import and Premium Luxury segments. In the reported quarter, revenues amounted to $6,398.7 million, shrinking 5% year over year and missing the Zacks Consensus Estimate of $6,683 million.
Adjusted SG&A expenses, as a percentage of gross profit, were 60.8%, deteriorating 4.4 percentage points from the year-ago period. Expenses rose to $782.7 million from $741.4 million in the year-ago quarter. AutoNation’s cash and cash equivalents were $58.3 million as of Mar 31, 2023, declining from $72.6 million recorded as of Dec 31, 2022. The company’s liquidity was $1.6 billion, including $58 million in cash and nearly $1.5 billion available under its revolving credit facility.
Group 1 Automotive (GPI - Free Report) reported first-quarter 2023 adjusted earnings per share of $10.93, which beat the Zacks Consensus Estimate of $9.70. The outperformance can be attributed to higher-than-anticipated revenues from all but the Financial/Insurance segment. The bottom line increased from the prior-year quarter’s $10.81 per share. The automotive retailer registered net sales of $4,130 million, beating the Zacks Consensus Estimate of $3,921 million. Also, the top line rose 7.4% from the year-ago quarter’s $3,844.4 million.
Selling, general and administrative expenses were up 10.6% year over year to $462.8 million. Group 1 Automotive had cash and cash equivalents of $21.3 million as of Mar 31, 2023, down from $47.9 million as of 2022-end. Total debt was $1,988.5 million as of Mar 31, 2023, down from $2,082.5 million recorded on Dec 31, 2022.