PAG Stock Forecast & Price Target

Penske Automotive Group is recognized as the third-largest publicly traded dealership in the U.S. by light-vehicle revenue, with a significant presence in both domestic and international markets, operating over 360 dealerships and offering more than 40 vehicle brands. The company has demonstrated strong performance in its used vehicle business, with gross profits per unit (GPU) consistently increasing over the last three quarters—recording growth rates of 20.3%, 24%, and 14.6% respectively—and projecting a 4% rise in total used gross profits for 2025. Additionally, Penske's diversified operations in service, finance, and insurance, alongside its established truck dealership segment, position the company for continued stability and growth despite challenges in new vehicle sales, particularly in the U.K. market.

Penske Automotive Group's financial outlook is negatively impacted by declining sales performance across several prominent brands it represents, including Porsche and Land Rover, which experienced decreases of 4.3% and 6.6%, respectively, in the second quarter of 2025, after positive growth in the first quarter. Overall sales for the firm also fell by 4.1%, contrasting with the previous quarter's increase of 6.4%. This trend of decreasing sales in a competitive luxury automotive market poses substantial risks to the company's revenue stability and growth prospects.