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Valued at a market cap of around $10 billion, Chicago, Illinois-based LKQ Corporation (LKQ) is a global leader in distributing replacement parts, components, and systems for vehicle repair and maintenance. Operating through four segments: Wholesale-North America; Europe; Specialty; and Self Service, it offers a diverse range of products, including aftermarket parts, recycled components, and specialty vehicle accessories. LKQ is expected to announce its fiscal Q4 earnings results before the market opens on Thursday, Feb. 20.
Ahead of this event, analysts expect the vehicle components company to report a profit of $0.75 per share, down 10.7% from $0.84 per share in the year-ago quarter. The company has surpassed Wall Street's earnings estimates in two of the last four quarters while missing on two other occasions. In Q3, LKQ exceeded the consensus EPS estimate by 1.2%.
For fiscal 2024, analysts expect LKQ to report an EPS of $3.43, down 10.4% from $3.83 in fiscal 2023. However, EPS is anticipated to rebound and grow 8.5% year-over-year to $3.72 in fiscal 2025.
Shares of LKQ have declined 19.9% over the past 52 weeks, lagging behind both the S&P 500 Index's ($SPX) 22.7% surge and the Consumer Discretionary Select Sector SPDR Fund's (XLY) 33.4% return over the period.
Despite LKQ Corporation reporting better-than-expected Q3 adjusted earnings of $0.88 per share, shares fell marginally on Oct. 24. The company’s quarterly revenue of $3.6 billion missed the consensus estimate. Additionally, LKQ revised its 2024 guidance downward, expecting parts and services organic revenues to decline and adjusted EPS to fall between $3.38 and $3.52. Weaker-than-expected EBITDA in key segments, such as Wholesale North America and Specialty, further dampened investor confidence.
Analysts' consensus view on LKQ Corporation’s stock is bullish, with a "Strong Buy" rating overall. Among eight analysts covering the stock, six recommend "Strong Buy," one suggests "Moderate Buy," and one indicates “Hold.” As of writing, LKQ is trading below the average analyst price target of $53.43.
