09:50 AM EDT, 04/30/2024 (MT Newswires) -- CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:

We increase our 12-month target by $10 to $125, based on a 2025 P/E of 8.4x, a justified discount to its 10-year mean forward P/E of 10.1x. We reduce our adjusted EPS estimates to $14.00 from $14.75 for 2024 and to $14.80 from $15.25 for 2025. PAG posted Q1 EPS of $3.21 vs. $4.31 (-26%), short of the $3.33 consensus. The miss was driven by weaker-than-expected margins, as revenue rose 1.5% to $7.45B ($30M below consensus) and gross margin contracted 40 bps to 16.7% (50 bps above consensus). PAG's top line was boosted by a 3.6% increase in auto sales volumes, partially offset by lower price realizations. Notably, gross margins were higher in the Retail Commercial Truck segment (12% of total revenue in Q1). We maintain a Sell rating on valuation and difficult Y/Y earnings comps. PAG continues to trade at a premium to many of its U.S. auto dealership peers despite being a lower-quality name, in our opinion. PAG's International exposure (40% of total revenue in 2023) continues to warrant a valuation discount.