An update has just come out today on Penske Auto Group (PAG), in which senior retail industry analyst Paul Raman, CFA is restating his Hold rating on the company. We excerpted the following details:

'Penske Auto Group is well positioned among the auto retailer peer group. The Penske Auto Group's specialty and luxury product mix offers opportunity for long-term growth. Additionally, we are encouraged by positive same-store sales in both new and used vehicles.

'Management provided second quarter and full year 2007 earnings outlook. In the third quarter, earnings from continuing operations are estimated to be in the range of $0.40 per share to $0.44 per share. For the full year 2007, earnings (excluding debt redemption charges) are expected to lie between $1.40 and $1.50 per share.

'Currently, shares of Penske Auto Group are trading at 13.5x our 2007 EPS estimate of $1.50. The company has a unique business model, a strong luxury automotive market, and a high growth rate. However, rising interest rates, challenging industry environment and a highly leveraged balance sheet make us apprehensive about the stock in the near-term. Thus, we keep our rating a Hold and maintain the six-month target price at $22.00, which is 14.7x our 2007 EPS estimate.'