Penske Automotive Group Increases Sales but Misses Estimates on Earnings

Penske Automotive Group (NYSE: PAG  ) reported earnings on Nov. 2. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Sep. 30 (Q3), Penske Automotive Group beat expectations on revenues and missed estimates on earnings per share.

Compared to the prior-year quarter, revenue increased significantly and GAAP earnings per share dropped significantly.

Margins dropped across the board.

Revenue details
Penske Automotive Group reported revenue of $3.40 billion. The 10 analysts polled by S&P Capital IQ expected sales of $3.30 billion on the same basis. GAAP reported sales were 15% higher than the prior-year quarter's $2.95 billion.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $0.46. The 11 earnings estimates compiled by S&P Capital IQ averaged $0.57 per share. GAAP EPS of $0.45 for Q3 were 26% lower than the prior-year quarter's $0.61 per share. (The prior-year quarter included -$0.01 per share in earnings from discontinued operations.)

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 15.0%, 80 basis points worse than the prior-year quarter. Operating margin was 2.6%, 10 basis points worse than the prior-year quarter. Net margin was 1.2%, 70 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $3.22 billion. On the bottom line, the average EPS estimate is $0.53.

Next year's average estimate for revenue is $13.13 billion. The average EPS estimate is $2.21.

Investor sentiment

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Penske Automotive Group is outperform, with an average price target of $32.50.

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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool has no positions in the stocks mentioned above. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


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