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Richard Sloan from the University of Michigan was first to document what is referred to as the "accrual anomaly". His 1996 paper found that shares of companies with small or negative accruals vastly outperform (+10%) those of companies with large ones.
As of Jun. 2026, Penske Automotive Group has a Sloan Ratio of 4.34%, indicating the company is in the safe zone and there is no funny business with accruals.
Penske Automotive Group (NYSE:PAG) Sloan Ratio % Explanation
A former University of Michigan researcher, Richard Sloan's 1996 paper found that shares of companies with small or negative accruals vastly outperform (+10%) those of companies with large ones. In fact, for the 40-year period between 1962 and 2001, buying the lowest accrual companies and shorting the highest accrual companies resulted in an average annual compounded return of 18%, more than double the S&P 500's 7.4% annual return over the same period.
If the Sloan Ratio is between -10% and 10%, the company is in the safe zone and there is no funny business with accruals.
If the Sloan Ratio is less than between -25% and -10% on the negative side, and between 10% and 25% on the positive side, this is a warning stage of accrual build up.
If the Sloan Ratio is less than -25% or greater than 25%, and this ratio is consistent over several quarters or even years, be careful. Earnings are highly likely to be made up of accruals.
As of Jun. 2026, Penske Automotive Group has a Sloan Ratio of 4.34%, indicating the company is in the safe zone and there is no funny business with accruals.
Penske Automotive Group Sloan Ratio % Related Terms
Penske Automotive Group Sloan Ratio % Historical Data
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
For the Auto & Truck Dealerships subindustry, Penske Automotive Group's Sloan Ratio %, along with its competitors' market caps and Sloan Ratio % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Penske Automotive Group Sloan Ratio % vs Vehicles & Parts Industry
For the Vehicles & Parts industry and Consumer Cyclical sector, Penske Automotive Group's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Penske Automotive Group's Sloan Ratio % falls into.
Earnings contain a lot of non cash earnings which is called accruals. The Sloan ratio is a way to identify firms with low non-cash or accrual-derived earnings relative to their cash flow.
Penske Automotive Group's Sloan Ratio for the fiscal year that ended in Dec. 2025 is calculated as
Penske Automotive Group's Net Income for the trailing twelve months (TTM) ended in Jun. 2026 was 213 (Sep. 2025 ) + 228.1 (Dec. 2025 ) + 234.5 (Mar. 2026 ) + 260.4 (Jun. 2026 ) = $936 Mil.
Penske Automotive Group's Cash Flow from Operations for the trailing twelve months (TTM) ended in Jun. 2026 was 351.7 (Sep. 2025 ) + 123.2 (Dec. 2025 ) + 215 (Mar. 2026 ) + 204.1 (Jun. 2026 ) = $894 Mil.
Penske Automotive Group's Cash Flow from Investing for the trailing twelve months (TTM) ended in Jun. 2026 was -71.2 (Sep. 2025 ) + -58.7 (Dec. 2025 ) + -634.4 (Mar. 2026 ) + 3.3 (Jun. 2026 ) = $-761 Mil.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Penske Automotive Group (PAG) has a Sloan Ratio % of 4.34% as of Jun. 2026. Sloan ratio measures earnings quality based on the amount of accruals. View historical data on Penske Automotive Group and its competitors.
Is Penske Automotive Group's Sloan Ratio % too high?
Penske Automotive Group's current Sloan Ratio % is 4.34%. Overall, Penske Automotive Group has a GF Score™ of 85/100 and is considered Modestly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Penske Automotive Group's Sloan Ratio % compare to KMX and ALTB?
Penske Automotive Group's Sloan Ratio % of 4.34% can be compared against companies in the Vehicles & Parts industry. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Sloan Ratio % for a Vehicles & Parts company?
A good Sloan Ratio % depends on the Vehicles & Parts industry context. However, Sloan Ratio % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Sloan Ratio % mean?
A high Sloan Ratio % can signal that a stock is expensive relative to its fundamentals. Sloan ratio measures earnings quality based on the amount of accruals. View historical data on Penske Automotive Group and its competitors. Penske Automotive Group's current Sloan Ratio % is 4.34%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Penske Automotive Group stock overvalued right now?
Based on GuruFocus' analysis, Penske Automotive Group (PAG) is currently considered Modestly Overvalued. The stock's GF Value™ is $170.66, compared to a current price of $216.40 — trading 26.8% above its estimated fair value. The current Sloan Ratio % is 4.34%. Penske Automotive Group's overall GF Score™ is 85/100 with 9 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Sloan Ratio % calculated?
Sloan Ratio % is calculated from a company's financial statements. For Penske Automotive Group (PAG), the current Sloan Ratio % is 4.34% as of Jun. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Penske Automotive Group (PAG) Overvalued in 2026?
Based on GuruFocus' analysis, Penske Automotive Group stock appears to be overvalued.
The current stock price of $216.40 is trading 26.8% above its estimated GF Value™ of $170.66.
GuruFocus considers Penske Automotive Group to be Modestly Overvalued.
Key valuation signals for PAG:
Sloan Ratio %: 4.34%
GF Value™: $170.66 vs. price of $216.40 (26.8% above fair value)
No single metric tells the full story. See the PAG stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Penske Automotive Group operates in 19 US states and overseas. It has about 150 US and Puerto Rico light-vehicle stores as well as 217 franchised dealerships overseas, primarily in the United Kingdom but also in Australia, Germany, Italy, and Japan. The company is the third-largest US publicly traded dealership in terms of light-vehicle revenue and sells more than 40 brands, with over 90% of retail automotive revenue coming from luxury and import names. Other segments are service and finance and insurance. The firm's Premier Truck Group owns 45 truck dealerships selling mostly Freightliner and Western Star brands, and Penske owns 15 used-vehicle stores, mostly in the US and UK under the CarShop (US) and Sytner Select (UK) brands. Penske is based in Bloomfield Hills, Michigan.
85GF Score
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