PAG Will Continue Returning Capital While Modest Earnings Risks Persist

Analysts have modestly raised their price target on Penske Automotive Group by approximately 1 dollar to reflect slightly stronger expectations for revenue growth and a marginally higher future earnings multiple, partially offset by a small reduction in projected profit margins and a higher discount rate.

What's in the News

• Completed a long running share repurchase program, buying back 198,475 shares between July 1 and October 24, 2025, for 33.35 million dollars, and totaling 30,698,231 shares, or 38.31 percent of shares outstanding, repurchased since the buyback began in 2010 (company buyback update)
• Continued returning capital to shareholders through an increased quarterly dividend of 1.38 dollars per share, up 4.5 percent, or 0.06 dollars, marking the 20th consecutive quarterly dividend increase, payable December 2, 2025, to shareholders of record on November 14, 2025 (company dividend announcement)

Valuation Changes

• The fair value estimate has risen slightly to approximately 180.89 dollars from 179.86 dollars, reflecting a modest upward revision in intrinsic value.
• The discount rate has increased slightly to about 10.45 percent from 10.22 percent, indicating a marginally higher required return and risk assessment.
• Revenue growth has been revised up modestly to roughly 3.87 percent from 3.58 percent, pointing to slightly stronger top line expectations.
• The net profit margin has edged down marginally to around 2.75 percent from 2.77 percent, reflecting a small anticipated pressure on profitability.
• The future P/E has risen slightly to about 16.22 times from 16.14 times, suggesting a modestly higher valuation multiple on expected earnings.