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Chicago-based LKQ Corporation (LKQ) is a major player in vehicle repair parts distribution, with a market cap of $11.1 billion. Operating through four segments – wholesale-North America, Europe, specialty, and self-service – LKQ keeps the wheels turning across the globe. LKQ is expected to announce its Q2 earnings for 2024 before the market opens on Thursday, July 25.
Ahead of the event, analysts expect LKQ to report a profit of $1.04 per share, down 4.6% from $1.09 per share reported in the year-ago quarter. The company has surpassed Wall Street’s EPS estimates in two of the past four quarters while missing on two other occasions.
Its adjusted EPS for the last reported quarter declined 21.2% annually to $0.82, missing the consensus estimate by 12.8%. A warmer-than-usual season curbed demand in the wholesale-North America segment, leading to fewer repairable claims and hit profitability.
Looking ahead to fiscal 2024, analysts expect LKQ to report an EPS of $3.93, up 2.6% from $3.83 in fiscal 2023. Its fiscal 2025 EPS is expected to grow 12% annually to $4.40.
LKQ stock is down 12.1% on a YTD basis, significantly underperforming the S&P 500 Index’s ($SPX) 16.8% gains and the S&P 500 Cons Disc Sector SPDR’s (XLY) 6.1% returns during the same time frame.
LKQ stock saw a massive drop of 14.9% on April 23 after the release of its Q1 earnings results. Although the company saw a double-digit revenue growth, its profits dropped by 41.5% to $158 million compared to Q1 2023. Additionally, facing tough challenges in Europe, LKQ divested its Slovenian operations in Q1 and plans to exit Bosnia by Q3 2024.
The consensus opinion on LKQ stock is bullish, with a “Strong Buy” rating overall. Out of the eight analysts covering the stock, six suggest a “Strong Buy,” one recommends a “Moderate Buy,” and the remaining one analyst suggests a “Hold” rating.
The average target price for LKQ is $60.43, indicating a potential upside of 45.8% from the current price levels.
On the date of publication, Sristi Jayaswal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
