Here's Why Penske Automotive (PAG) is a Strong Momentum Stock

Core Insights - The article emphasizes the importance of utilizing Zacks Premium for investors to enhance their stock market strategies and confidence in investing [1] Zacks Style Scores Overview - Zacks Style Scores are designed to assist investors in selecting stocks with the highest potential to outperform the market within a 30-day timeframe, using an alphabetic rating system from A to F [2] - Stocks rated A have the best chance of outperforming, while those rated F have the least potential [2] Categories of Style Scores - Value Score: Focuses on identifying undervalued stocks by analyzing financial ratios such as P/E, PEG, Price/Sales, and Price/Cash Flow [3] - Growth Score: Evaluates stocks based on projected and historical earnings, sales, and cash flow to identify those with sustainable growth potential [4] - Momentum Score: Targets stocks experiencing upward or downward trends in price or earnings, using metrics like one-week price change and monthly earnings estimate changes [5] - VGM Score: A composite score that combines Value, Growth, and Momentum Scores, providing a comprehensive view of a stock's attractiveness [6] Zacks Rank and Style Scores Interaction - The Zacks Rank is a proprietary model that leverages earnings estimate revisions to guide investors in building successful portfolios [7] - Stocks rated 1 (Strong Buy) have historically achieved an average annual return of +25.41% since 1988, significantly outperforming the S&P 500 [8] - There are over 800 stocks rated 1 or 2, which can be overwhelming for investors [9] Investment Strategy Recommendations - For optimal returns, investors should focus on stocks with a Zacks Rank of 1 or 2 and Style Scores of A or B [10] - Stocks rated 3 (Hold) should also have Style Scores of A or B to maximize upside potential [10] - The direction of earnings estimate revisions is crucial; stocks with lower ranks but high Style Scores may still face price declines [11] Company Spotlight: Penske Automotive Group (PAG) - Penske Automotive Group operates automotive and commercial truck dealerships across multiple countries and employs over 28,900 people globally [12] - PAG holds a 3 (Hold) rating on the Zacks Rank, with a VGM Score of A and a Momentum Style Score of A, indicating potential for momentum investors [13] - The company has seen a 2.5% increase in shares over the past four weeks, with positive earnings estimate revisions for fiscal 2025 [13] - With a solid Zacks Rank and strong Style Scores, PAG is recommended for investors' consideration [14]