Zacks Investment Research downgraded shares of Penske Automotive Group, Inc. (PAG) from OUTPERFORM to NEUTRAL on September 24, 2012, with a target price of $32.00.
Penske Automotive offers a wide range of imported and luxury brands, which helps it to maintain a strong foothold in both the U.S. and overseas markets. The company is poised for earnings growth, driven by its ability to identify, acquire and integrate dealerships. In the most recent quarter, Penske's profit exceeded the Zacks Consensus Estimate by a penny. However, the overall situation in the U.S. retail vehicle market is challenging for both new and used car sales volume. In addition, competition with retail and service centers owned by original equipment manufacturers is likely to put pressure on the company's margins. Thus, we have downgraded our recommendation on its shares to Neutral from Outperform with a target price of $32.00.
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