Penske Q1 Earnings Surpass Expectations, Revenues Rise Y/Y

Penske Automotive Group PAG reported first-quarter 2025 adjusted earnings of $3.39 per share, which increased 6% year over year and beat the Zacks Consensus Estimate of $3.27. Better-than-expected results from the Retail Automotive segment, the Retail Commercial Truck segment and the Commercial Vehicle Distribution and Other segment contributed to the outperformance. The company registered net sales of $7.60 billion, beating the Zacks Consensus Estimate of $7.59 billion. The top line rose 2.1% from the year-ago quarter's level.

Penske’s gross profit in the reported quarter rose 1.9% on a year-over-year basis to $1.27 billion. The operating income contracted 3.7% to $315.5 million. Foreign currency exchange negatively impacted revenues by $40.3 million, net income by $0.5 million and earnings per share (EPS) by 1 cent.

In the reported quarter, same-store retail units declined 4.5% year over year to 106,251. Within the Retail Automotive segment, same-store new-vehicle revenues were up 7.2% to $2.92 billion. Same-store used vehicle revenues decreased 3.1% to $2.14 billion.

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 of PAG

In the reported period, revenues in the Retail Automotive segment came in at $6.57 billion, which increased 1.4% from the year-ago quarter's level and beat our estimate of $6.37 billion. Total new and used vehicle deliveries were down 7.5% year over year to 109,088 units. Gross profit of $1.08 billion rose 2.5% year over year and beat our estimate of $1.04 billion.

Revenues in the Retail Commercial Truck segment increased 4% to $823.7 million and topped our estimate of $805.5 million. Gross profit in the segment was $141 million, down from $144.8 million reported in the year-earlier quarter, but surpassed our estimate of $135.1 million.

The Commercial Vehicle Distribution and Other segment’s revenues in the reported quarter increased 18.8% to $211.5 million and surpassed our estimate of $206.7 million. Gross profit came in at $44.2 million, which increased from $43.2 million reported in the year-ago period and beat our estimate of $42.8 million.

(Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)

Financial Tidbits

In the quarter under review, SG&A costs totaled $913.6 million, up 3.8% year over year. As of March 31, 2025, Penske had cash and cash equivalents of $118.4 million, up from $72.4 million as of Dec. 31, 2024. The long-term debt amounted to $1.77 billion, down from $1.85 billion as of Dec. 31, 2024.

During the quarter under discussion, PAG repurchased 254,406 shares of common stock for $39.9 million. Between April 1, 2025, and April 25, 2025, the company repurchased an additional 495,570 shares of common stock for $71.2 million. As of April 25, 2025, $45.8 million of stock repurchase authorization remained outstanding. As of March 31, 2025, PAG had around $2.1 billion in liquidity.

PAG’s Zacks Rank & Key Picks

Penske carries a Zacks Rank #3 (Hold) at present.

Some better-ranked stocks in the auto space are Hesai Group HSAI and Standard Motor Products, Inc. SMP. HSAI sports a Zacks Rank #1 (Strong Buy), while SMP carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for HSAI’s 2025 earnings indicates year-over-year growth of 336.36%, respectively. EPS estimates for 2026 have improved 12 cents in the past seven days.

The Zacks Consensus Estimate for SMP’s 2025 sales and earnings implies year-over-year growth of 16.61% and 10.73%, respectively. EPS estimates for 2025 have improved 5 cents in the past 60 days. EPS estimates for 2026 have improved by a penny in the past 30 days.

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This article originally published on Zacks Investment Research (zacks.com).

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