PAG

Penske Automotive Group Inc

Industrial/Transportation


Presented:07/25/2022
Price:$110.22
Cap:$8.36B
Current Price:$154.79
Cap:$10.34B

Presented

Date07/25/2022
Price$110.22
Market Cap$8.36B
Ent Value$14.06B
P/E Ratio6.33x
Book ValueN/A
Div Yield1.71%
Shares O/S75.89M
Ave Daily Vol379,828
Short Int12.54%

Current

Price$154.79
Market Cap$10.34B
Penske Automotive Group, Inc. operates as an international transportation services company. Which engages in the distribution of commercial vehicles, diesel engines, gas engines, power systems and related parts & services. It operates through the following segments: Retail Automotive, Retail Commercial Truck, Non-Automotive Investments, and Other. The Retail Automotive segment consists of retail automotive dealership operations. The Retail Commercial Truck segment is the dealership operations of commercial trucks in the U.S. and Canada. The Other segment comprises commercial vehicle and power systems distribution operation and other non-automotive consolidated operations. The Non-Automotive Investments segment is the equity method investments in non-automotive operations. The company was founded in October 1992 and is headquartered in Bloomfield Hills, MI.

Publicly traded companies mentioned herein: AutoNation Inc (AN), CarMax Inc (KMX), Lithia Motors Inc (LAD), Penske Automotive Group Inc (PAG)

Highlights

The presenter is short shares of Penske Automotive Group Inc (PAG), a large national automotive and commercial truck dealership franchisee that generated record profits last year on the back of inflated used car prices. Used car prices are already beginning to soften and PAG has also seen its gross profit per unit (GPU) decline this quarter, which does not bode well for valuation considering the company’s EPS today is more than triple pre-pandemic levels. As used car prices continue to soften and PAG begins losing inventory and adding debt, its $17 EPS should normalize in line with major national competitors, causing its share price to depreciate by ~60%.

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Idea Discussion

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