A lot has changed since 1948 when Harry Truman was President and Ford unveiled the '49 Ford, its new car of year. But one thing hasn't. Since going public in 1948, Genuine Parts has paid a cash dividend every year. And 2023 marks the auto parts retailer's 67th consecutive year of increased dividends paid to shareholders.
Fast forward to today and GPC stock joins peers O'Reilly Automotive and AutoZone in the driver's seat on the lookout for a new breakout. Genuine Parts also earns placement on the IBD Breakout Stocks Index, which gets updated weekly.
With a 91 Composite Rating, GPC stock trails just behind O'Reilly's score of 93. AutoZone, which just posted a surprise earnings gain but then skidded lower, holds an 81 Composite Rating. Fellow auto parts leader Advance Auto Parts also initially popped on earnings but retreated below its 50-day line. It lags the others with a 41 rating.
Who Joins GPC Stock On The IBD Breakout Stocks Index?
Napa Brand Drives Steady Growth For Genuine Parts
Founded in 1928, Genuine Parts is global in scope, divided into two major divisions:
- Automotive Parts Group, comprising about 66% of net sales, distributes replacement parts in the U.S., Canada, Mexico, Australasia, France, the United Kingdom, Ireland, Germany, Poland, the Netherlands, Belgium, Spain and Portugal.
- Industrial Parts Group, comprising about one-third of net sales, distributes industrial replacement parts in the U.S., Canada, Mexico and Australasia.
In North America, the company primarily sells auto parts under the Napa brand. In Europe, Genuine Parts sells Napa products under a variety of banners, such as GROUPAUTO France and GROUPAUTO UK.
Worldwide, Genuine Parts has roughly 58,000 employees with a network of over 10,000 locations in 17 countries.
On Feb. 23, the company reported Q4 and full-year 2022 numbers. Both earnings growth and sales growth came in at 15% in the fourth quarter. EPS rose to $2.05 while Q4 revenue exceeded $5.5 billion.
Over the last three years, Genuine Parts has posted average annual sales growth of 9% and average EPS gains of 22%. The company earns an A SMR Rating, which tracks sales growth, profit margins and return on equity.
Building on its impressive streak of dividend payments, the auto parts leader's current yield is 2.00% on an annualized basis.
Genuine Parts Vs. Auto Parts Peers ORLY, AZO and AAP
While Genuine Parts and its peers did not make the latest list of new buys by the best mutual funds, institutional investors have shown signs of demand for GPC stock.
Genuine Parts has posted three quarters of rising fund ownership, That outpaces one quarter for O'Reilly and Advance Auto Parts, and zero for AutoZone.
Plus, 70 funds with an A or A+ rating from IBD own shares of GPC stock.
Over the last year, Genuine Parts showed a 13% increase in the number of funds with a position in GPC stock, topping that of its auto parts competitors.
| Fund Ownership Growth | ||||
|---|---|---|---|---|
| Genuine Parts | AutoZone | O'Reilly Automotive | Advance Auto Parts | |
| 22-Mar | 1,572 | 2,160 | 2,206 | 1,561 |
| 22-Dec | 1,777 | 2,365 | 2,295 | 1,521 |
| %Chg | 13% | 4.9% | 4% | -2.5% |
In terms of market capitalization, O'Reilly Automotive and AutoZone clearly surpass the others. But at $21 billion, Genuine Parts qualifies as leading large cap.
| Market Capitalization | |||
|---|---|---|---|
| O'Reilly Automotive | AutoZone | Genuine Parts | Advance Auto Parts |
| $52 billion | $47 billion | $25 billion | $9 billion |
GPC Stock, AZO And ORLY Test-Drive New Buy Zones
Genuine Parts continues to work on an early stage cup with handle. The buy point is 180.85.
The relative strength line retreated as GPC stock formed its base, but has come off its recent lows. Look for the RS line to get closer to a 52-week high as the buy point nears.
Within the cup with handle, GPC stock has flashed several days of above-average volume, pointing to demand among large investors. Genuine Parts currently trades 2% shy of the buy point.
Showing that stocks tend to move in groups, ORLY and AZO stock retreated Tuesday, as did Genuine Parts. All three auto parts retailers are testing buy points and buy zones, but face tests as the market indexes look to find support.
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Follow Matthew Galgani on Twitter at @IBD_MGalgani.
