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Penske (PAG) Q2 Earnings Mark 13th Straight Quarter of Beat
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Penske Automotive Group (PAG - Free Report) reported second-quarter 2023 adjusted earnings of $4.41 per share, which decreased 11% year over year but surpassed the Zacks Consensus Estimate of $4.08. This marked the 13th consecutive earnings beat for the company.
The auto retailer registered net sales of $7,468.5 million, which topped the Zacks Consensus Estimate of $7,056 million. The top line rose 8% from the year-ago quarter. Strong performance in automotive and commercial truck operations contributed to the outperformance.
Penske’s gross profit in the reported quarter increased 2.9% on a year-over-year basis to $1,273 million. The operating income went down 1.8% to $380 million. Foreign currency exchange adversely affected revenues by $23.7 million, net income attributable to common stockholders by $0.5 million and earnings per share by $0.01.
In the reported quarter, same-store retail units rose 5.6% year over year to 120,203. Within the Retail Automotive segment, same-store new-vehicle revenues were up 15.1% to $2,782.4 million. Same-store used-vehicle revenues fell 3.5% to $2,269.8 million.
Penske Automotive Group, Inc. Price, Consensus and EPS Surprise
In the reported period, revenues in the Retail Automotive segment came in at $6,406 million, up 6.8% from a year ago and topping our estimate of $5,621.7 million. The outperformance resulted from higher-than-expected revenues from new and used vehicles as well as parts/services. Gross profit of $1,085.9 inched up 2.4% year over year and came ahead of our estimate of $956.5 million.
Revenues in the Retail Commercial Truck segment increased 19.6% to $919.2 million but fell short of our estimate of $930 million. Sales underperformance could be attributable to lower used Retail Commercial Truck sales of 704 units compared with our estimate of 772 units. Gross profit in the segment was $146.8 million, rising from $136 million in the year-earlier quarter figure and topping our expectation of $129.7 million.
The Commercial Vehicle Distribution and Other segment’s revenues in the reported quarter increased 1.7% to $143.3 million and lagged our estimate of $153.6 million. Gross profit came in at $40.3 million, down from $41 million in the year-ago period but higher than our estimate of $37 million.
Financial Tidbits
In the quarter under review, SG&A costs totaled $858.1 million, up 4.9% year over year. As of Jun 30, 2023, Penske had cash and cash equivalents of $119.6 million, up from $106.5 million on Dec 31, 2022. The long-term debt amounted to $1,743.7 million, up from $1,622.1 million as of Dec 31, 2022.
During the quarter under discussion, PAG repurchased 2.6 million shares of common stock for $350.4 million. As of Jun 30, 2023, $246.3 million of stock repurchase authorization remained outstanding.
The Zacks Consensus Estimate for F’s 2023 sales implies year-over-year growth of 4.9%. The 2023 EPS estimate has been revised upward by 5 cents in the past seven days. The EPS estimate for 2024 has moved north by 5 cents in the past seven days.
The Zacks Consensus Estimate for OSK’s 2023 sales and earnings implies year-over-year growth of 7.2% and 282.9%, respectively. The EPS estimate for 2023 has moved up by a cent in the past seven days. The 2024 EPS estimate has remained unchanged in the past seven days.
The Zacks Consensus Estimate for LEA’s 2023 sales and earnings implies year-over-year growth of 16% and 80.5%, respectively. The EPS estimate for 2023 has moved north by 25 cents in the past seven days. The 2024 EPS estimate has moved up by 8 cents in the past seven days.
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Penske (PAG) Q2 Earnings Mark 13th Straight Quarter of Beat
Penske Automotive Group (PAG - Free Report) reported second-quarter 2023 adjusted earnings of $4.41 per share, which decreased 11% year over year but surpassed the Zacks Consensus Estimate of $4.08. This marked the 13th consecutive earnings beat for the company.
The auto retailer registered net sales of $7,468.5 million, which topped the Zacks Consensus Estimate of $7,056 million. The top line rose 8% from the year-ago quarter. Strong performance in automotive and commercial truck operations contributed to the outperformance.
Penske’s gross profit in the reported quarter increased 2.9% on a year-over-year basis to $1,273 million. The operating income went down 1.8% to $380 million. Foreign currency exchange adversely affected revenues by $23.7 million, net income attributable to common stockholders by $0.5 million and earnings per share by $0.01.
In the reported quarter, same-store retail units rose 5.6% year over year to 120,203. Within the Retail Automotive segment, same-store new-vehicle revenues were up 15.1% to $2,782.4 million. Same-store used-vehicle revenues fell 3.5% to $2,269.8 million.
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 $6,406 million, up 6.8% from a year ago and topping our estimate of $5,621.7 million. The outperformance resulted from higher-than-expected revenues from new and used vehicles as well as parts/services. Gross profit of $1,085.9 inched up 2.4% year over year and came ahead of our estimate of $956.5 million.
Revenues in the Retail Commercial Truck segment increased 19.6% to $919.2 million but fell short of our estimate of $930 million. Sales underperformance could be attributable to lower used Retail Commercial Truck sales of 704 units compared with our estimate of 772 units. Gross profit in the segment was $146.8 million, rising from $136 million in the year-earlier quarter figure and topping our expectation of $129.7 million.
The Commercial Vehicle Distribution and Other segment’s revenues in the reported quarter increased 1.7% to $143.3 million and lagged our estimate of $153.6 million. Gross profit came in at $40.3 million, down from $41 million in the year-ago period but higher than our estimate of $37 million.
Financial Tidbits
In the quarter under review, SG&A costs totaled $858.1 million, up 4.9% year over year. As of Jun 30, 2023, Penske had cash and cash equivalents of $119.6 million, up from $106.5 million on Dec 31, 2022. The long-term debt amounted to $1,743.7 million, up from $1,622.1 million as of Dec 31, 2022.
During the quarter under discussion, PAG repurchased 2.6 million shares of common stock for $350.4 million. As of Jun 30, 2023, $246.3 million of stock repurchase authorization remained outstanding.
Zacks Rank & Key Picks
PAG currently carries a Zacks Rank #2 (Buy).
A few other top-ranked players in the auto space include Ford Motor Company (F - Free Report) , Oshkosh Corporation (OSK - Free Report) and Lear Corporation (LEA - Free Report) . While F and OSK each sport a Zacks Rank #1 (Strong Buy), LEA carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for F’s 2023 sales implies year-over-year growth of 4.9%. The 2023 EPS estimate has been revised upward by 5 cents in the past seven days. The EPS estimate for 2024 has moved north by 5 cents in the past seven days.
The Zacks Consensus Estimate for OSK’s 2023 sales and earnings implies year-over-year growth of 7.2% and 282.9%, respectively. The EPS estimate for 2023 has moved up by a cent in the past seven days. The 2024 EPS estimate has remained unchanged in the past seven days.
The Zacks Consensus Estimate for LEA’s 2023 sales and earnings implies year-over-year growth of 16% and 80.5%, respectively. The EPS estimate for 2023 has moved north by 25 cents in the past seven days. The 2024 EPS estimate has moved up by 8 cents in the past seven days.