One-glance verdict
Within fair range
$175.48 our estimate vs market $212.42
Wall Street consensus: $210.57 (20.0% higher than our fair-value estimate)
21% above our estimate
Fundamentals snapshot
Penske Automotive Group, Inc.
PAG · NYQ · Consumer Cyclical · Auto & Truck Dealerships
Current price
$212.42
52-week range
$140.12 - $227.00
Market cap
$13.95B
Balance sheet
Stretched
4.88x Stretched
Net debt $9.30B. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
3 Risks
3 rewards · 3 risks
- Reward Revenue grew 0.1% last year.
- Reward Returns 15.8% on equity, ahead of 75% of its peers.
- Risk Stock trades 53.8% above its 5-year average P/E.
- Risk Net debt grew 26.4% over 3 years.
What this company does
Penske Automotive Group, Inc.
Penske Automotive Group is a global company that runs a large network of car and commercial truck dealerships. While they sell new and used vehicles, a large part of their profit comes from related services like repairs, maintenance, and helping customers arrange financing and insurance. This is important because these services provide more predictable recurring revenue (income that is likely to continue in the future), making the company less sensitive to the ups and downs of the vehicle sales market.
How the company got here
Founded in 1990 by Roger Penske as United Auto Group, the company grew by acquiring other car dealerships. A major turning point was its 1999 acquisition by the Penske Corporation, which brought it under the control of the well-respected Penske brand. In 2007, the company officially changed its name to Penske Automotive Group, solidifying its association with the Penske name, which is synonymous with quality in the transportation industry. Over the years, it has expanded internationally, particularly in the United Kingdom, and has diversified into selling commercial trucks.
What it actually does
Penske Automotive Group is a global transportation services company that you would most likely encounter as a car or truck dealership. They sell new and used vehicles, from luxury cars to heavy-duty trucks, and also provide the services needed to keep those vehicles on the road. This includes maintenance and repair services, selling replacement parts, and collision repair. They also help customers with financing and insurance when they purchase a vehicle.
Retail Automotive
This is the largest part of Penske's business and what most people think of when they hear the name. It consists of traditional car dealerships that sell new and used vehicles from a wide variety of brands, with a focus on premium and luxury cars. When you buy a car from a Penske dealership, they also offer financing (arranging a loan for you to buy the car) and insurance products. This segment also includes their used-car brand, CarShop, which offers no-haggle pricing.
Retail Commercial Truck
This segment operates dealerships that sell new and used commercial trucks, such as those made by Freightliner and Western Star. Just like the car dealerships, these locations also provide maintenance and repair services to keep the trucks running. This is a significant part of the company's business, providing a different stream of revenue (income) than passenger cars.
Other
This smaller segment focuses on the distribution (the process of getting goods from the manufacturer to the customer) of commercial vehicles, engines, and power systems, primarily in Australia and New Zealand. Think of this as the wholesale side of the business, where they supply vehicles and parts to other businesses rather than selling directly to individual customers.
Non-Automotive Investments
This part of the company includes its investment in Penske Transportation Solutions, a large business that manages a huge fleet of trucks for other companies. This provides Penske Automotive Group with a source of income that is related to transportation but not directly tied to selling individual vehicles. It's a way for the company to diversify its interests and not have all its eggs in one basket.
What management is betting on now
The company's leadership is focused on growing its commercial truck and used vehicle businesses to balance out the ups and downs of the new car market. They are also investing heavily in digital tools to make the car buying and service experience easier for customers. Another key priority is expanding their high-margin (meaning they keep a larger percentage of the sales price as profit) parts and service operations, especially as more electric vehicles come to market. Finally, they continue to look for opportunities to acquire other dealerships to increase their market share (the percentage of total sales in an industry generated by a particular company).
Price history
How the share price has moved
—
Loading price history…
Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q3
$190.10M
FY2024 Q4
$131.60M
FY2025 Q1
$206.10M
FY2025 Q2
$118.90M
FY2025 Q3
$300.40M
FY2025 Q4
$25.10M
FY2026 Q1
$152.40M
FY2026 Q2
$131.80M
Revenue
$8.51B
Net income
$260.40M
Diluted EPS
3.96
Operating cash flow
$204.10M
Free cash flow
$131.80M
Fetching…
Sources
Revenue
$7.86B
Net income
$234.50M
Diluted EPS
3.56
Operating cash flow
$215.00M
Free cash flow
$152.40M
Fetching…
Sources
Revenue
$7.77B
Net income
$186.10M
Diluted EPS
2.83
Operating cash flow
$123.20M
Free cash flow
$25.10M
Fetching…
Sources
Revenue
$7.70B
Net income
$213.00M
Diluted EPS
3.23
Operating cash flow
$379.50M
Free cash flow
$300.40M
Fetching…
Sources
Revenue
$7.66B
Net income
$250.00M
Diluted EPS
3.78
Operating cash flow
$189.70M
Free cash flow
$118.90M
Fetching…
Sources
Revenue
$7.60B
Net income
$244.30M
Diluted EPS
3.66
Operating cash flow
$282.70M
Free cash flow
$206.10M
Fetching…
Sources
Revenue
$8.08B
Net income
$249.30M
Diluted EPS
3.73
Operating cash flow
$217.70M
Free cash flow
$131.60M
Fetching…
Sources
Revenue
$7.59B
Net income
$226.10M
Diluted EPS
3.39
Operating cash flow
$271.00M
Free cash flow
$190.10M
Fetching…
Sources
Is it cheap or expensive?
Fair value $175.48 vs current price $212.42
Wall Street consensus is the average analyst price target: $210.57 (20.0% higher than our fair-value estimate).
Our most-likely fair value is $175.48 a share — about 17.4% away from today's price of $212.42, so the stock currently looks fairly priced.
Is it drowning in debt?
Stretched
Net debt $9.3B. Interest coverage 4.9x.
Net debt
$9.30B
Interest coverage
4.88x
Penske Automotive Group, Inc.'s profit covers its interest bill about 4.9 times over. which is stronger than most peers shown here and 1 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Stretched
Worse cushion
Baseline
Better cushion
PAG
BASELINE
Penske Automotive Group, Inc.
Total debt $9.37B Interest coverage 4.88x This is the baseline the peer rows are being compared against.
Total debt $12.86B Interest coverage 7.42x +52% vs PAG Carries about 1.5x more debt cushion than PAG.
Total debt $18.07B Interest coverage -0.47x -100% vs PAG This peer has almost no interest-payment cushion compared with PAG.
Total debt $2.34B Interest coverage 13.46x +176% vs PAG Carries about 2.8x more debt cushion than PAG.
Total debt $128.77B Interest coverage 4.00x -18% vs PAG Carries about 1.2x less debt cushion than PAG.
Total debt $16.56B Interest coverage 1.83x -62% vs PAG Carries about 2.7x less debt cushion than PAG.
What you should know
The case for and against PAG
3 Rewards
3 Risks
Rewards
-
Revenue grew 0.1% last year.
-
Returns 15.8% on equity, ahead of 75% of its peers.
-
Free cash flow was positive in 10/10 years.
Risks
-
Stock trades 53.8% above its 5-year average P/E.
-
Net debt grew 26.4% over 3 years.
-
Forward P/E (15.1x) is higher than trailing (14.9x) - earnings are expected to drop.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
14.94x
Forward P/E
15.13x
P/B
2.40x
P/S
0.43x
EV/EBITDA
16.68x
PEG ratio
2.69x
Profitability
How much profit each dollar creates
Gross margin
16.1%
Operating margin
4.0%
Net margin
2.8%
ROE
15.8%
ROA
4.2%
Health
Liquidity and balance-sheet strength
Debt / equity
1.61x
Current ratio
0.97x
Quick ratio
0.17x
Total debt
$9.37B
Total cash
$69.50M
Growth
How the business has been compounding
Revenue TTM
$31.84B
Revenue 5Y CAGR
5.6%
EPS TTM
14.22
EPS 5Y CAGR
-8.7%
Cash flow
How much cash the business throws off
Operating CF TTM
$921.80M
Free CF TTM
$650.50M
FCF margin
2.0%
Dividend
Shareholder payout
Yield
2.8%
Payout ratio
38.8%
Last ex-div date
2026-11-13