Penske's 3Q results beat expectations
BLOOMFIELD HILLS, Mich. (AP) — Penske Automotive Group Inc. reported third-quarter results that beat market expectations as it sold more vehicles. But the auto dealership group's shares fell in Friday trading as investors worried about the pricing pressure the company experienced.
Net income fell to $41 million, or 45 cents per share, for the quarter that ended Sept. 30. That compares with $55.7 million, or 61 cents per share, a year ago. Penske made 60 cents per share from continuing operations on an adjusted basis in the recent quarter.
Revenue rose 17.4 percent to $3.4 billion.
Analysts expected 57 cents per share on revenue of $3.27 billion, according to FactSet.
The company said that revenue from stores open at least a year increased by 11.7 percent. That is considered a key measure of financial performance because it strips away the impact of recently opened or closed stores. Total vehicle sales jumped 21 percent in the U.S. and 29 percent overseas.
Penske Chairman Roger Penske said that pricing pressures increased in the period. The average price fell about 4 percent, to $36,497, for new vehicles sold and around 5 percent, to $24,982, for used.
The company, headquartered in Bloomfield Hills, Mich., operates auto sales, maintenance and repair sites across the United States and the United Kingdom.
Shares fell $2.09, or 6.6 percent, to $29.51 in afternoon trading. The stock had been largely on an upward trend, gaining more than 50 percent since June.