• Sentiment has shifted to more `upbeat,' BB&T analyst says
  • Retailers' shares have been declining on U.S. auto-sales fears

Penske Automotive Group Inc. and Sonic Automotive Inc. led a rare surge for car-dealer shares after telling investors they can weather an industry loaded with inventory amid slowing U.S. auto-sales growth.

Shares of Penske, which reported first-quarter revenue that beat analysts’ estimates, climbed as much as 10 percent, the biggest intraday gain since November 2011. Sonic’s stock gained as much as 16 percent, the most since May 2009.

Auto-retailer stocks have been falling this year amid pessimism about further U.S. auto-sales gains after last year’s record deliveries and had taken a hit in April after March sales grew at the slowest pace in 13 months. Last week, shares of Lithia Motors Inc. fell the most in 18 months after it trimmed its forecast for this year’s new-vehicle sales.

“The challenges are there but they’re taking steps to navigate and remedy some of the issues that are out of their control,” Anthony Cristello, an analyst at BB&T Capital Markets, said of Sonic and Asbury Automotive Group Inc., another dealer chain that reported quarterly results Tuesday. While dealerships have had to contend with challenges such as oversupply of luxury vehicles and parts recalls, sentiment about the industry has now shifted “toward more of an upbeat or positive momentum,” he said.

Penske rose 9.7 percent to $39.52 at 1:56 p.m. New York time. Sonic gained 15 percent to $18.96, while Asbury climbed 11 percent to $63.55.

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