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LKQ Corporation (LKQ - Free Report) reported adjusted earnings of 69 cents per share in fourth-quarter 2020, surpassing the Zacks Consensus Estimate of 59 cents. This outperformance was driven by the higher-than-anticipated EBITDA from the parts and services segment in North America. EBITDA from the North American market came in at $212.6 million, beating the Zacks Consensus Estimate of $167 million.
Moreover, the bottom line comes in higher than the year-ago quarter’s profit of 54 cents per share, up 27.8% year on year.
This aftermarket auto parts distributor registered quarterly revenues of $2,953.9 million, topping the Zacks Consensus Estimate of $2,880 million. However, the top-line figure edged down 1.9% from the year-ago level of $3,009.9 million. Parts and services organic growth also declined 5.2% year over year.
For the December-end quarter, revenues from the North American segment totaled $1,166.5 million, down from the $1,283.1 million reported in the prior-year period. The reported figure, however, exceeded the consensus mark of $1,014 million. Moreover, EBITDA from the segment came in at $212.6 million, increasing 18.1% year over year.
Revenues from the European segment summed $1,433.3 million for the reported quarter, up from the $1,424.9 million recorded in the year-earlier quarter. The reported figure also beat the consensus mark of $1,421 million. The segment’s EBITDA came in at $123.8 million, climbing 14.7% year over year. The reported EBITDA figure is at par with the consensus mark.
For the October-December period, revenues and EBITDA from the Specialty segment came in at $355.1 million and $29.9 million, higher than the year-ago respective figure of $303.4 million and $25.4 million. While the revenue figure topped the consensus mark of $32 million, the EBITDA marginally missed the consensus mark of $30.3 million.
Financial Position
LKQ Corp had cash and cash equivalents of $312.2 million as of Dec 31, 2020, down from the $523 million recorded as of Dec 31, 2019. Long-term debt (excluding current portion) amounted to $2,812.6 million as on Dec 31, 2020, down from the $3,715.4 million recorded as of Dec 31, 2019.
During the fourth quarter, the company generated net cash of $309.2 million from operations, skyrocketing 212.8% from the year-ago period. It generated free cash flow of $246.5 million in the quarter compared with the negative free cash flow of $1.3 million witnessed in the prior-year quarter.
During the reported quarter, the company repurchased roughly $29 million of its common stock. Since the inception of its repurchase program, the company has repurchased 17.3 million shares for a total of $469 million.
2021 Outlook
For 2021, the company projects EPS in the range of $2.40-$2.60 per share and adjusted EPS of $2.65-$2.85 per share. The company envisions generating free cash flow of minimum $800 million. The company is targeting free cash flow conversion of EBITDA at 55-60%.
Zacks Rank & Stocks to Consider
LKQ Corp currently carries a Zacks Rank #3 (Hold).
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
You know this company from its past glory days, but few would expect that it’s poised for a monster turnaround. Fresh from a successful repositioning and flush with A-list celeb endorsements, it could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in a little more than 9 months and Nvidia which boomed +175.9% in one year.
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LKQ Corp's (LKQ) Q4 Earnings Beat Estimates, Improve Y/Y
LKQ Corporation (LKQ - Free Report) reported adjusted earnings of 69 cents per share in fourth-quarter 2020, surpassing the Zacks Consensus Estimate of 59 cents. This outperformance was driven by the higher-than-anticipated EBITDA from the parts and services segment in North America. EBITDA from the North American market came in at $212.6 million, beating the Zacks Consensus Estimate of $167 million.
Moreover, the bottom line comes in higher than the year-ago quarter’s profit of 54 cents per share, up 27.8% year on year.
This aftermarket auto parts distributor registered quarterly revenues of $2,953.9 million, topping the Zacks Consensus Estimate of $2,880 million. However, the top-line figure edged down 1.9% from the year-ago level of $3,009.9 million. Parts and services organic growth also declined 5.2% year over year.
LKQ Corporation Price, Consensus and EPS Surprise
LKQ Corporation price-consensus-eps-surprise-chart | LKQ Corporation Quote
Segment Highlights
For the December-end quarter, revenues from the North American segment totaled $1,166.5 million, down from the $1,283.1 million reported in the prior-year period. The reported figure, however, exceeded the consensus mark of $1,014 million. Moreover, EBITDA from the segment came in at $212.6 million, increasing 18.1% year over year.
Revenues from the European segment summed $1,433.3 million for the reported quarter, up from the $1,424.9 million recorded in the year-earlier quarter. The reported figure also beat the consensus mark of $1,421 million. The segment’s EBITDA came in at $123.8 million, climbing 14.7% year over year. The reported EBITDA figure is at par with the consensus mark.
For the October-December period, revenues and EBITDA from the Specialty segment came in at $355.1 million and $29.9 million, higher than the year-ago respective figure of $303.4 million and $25.4 million. While the revenue figure topped the consensus mark of $32 million, the EBITDA marginally missed the consensus mark of $30.3 million.
Financial Position
LKQ Corp had cash and cash equivalents of $312.2 million as of Dec 31, 2020, down from the $523 million recorded as of Dec 31, 2019. Long-term debt (excluding current portion) amounted to $2,812.6 million as on Dec 31, 2020, down from the $3,715.4 million recorded as of Dec 31, 2019.
During the fourth quarter, the company generated net cash of $309.2 million from operations, skyrocketing 212.8% from the year-ago period. It generated free cash flow of $246.5 million in the quarter compared with the negative free cash flow of $1.3 million witnessed in the prior-year quarter.
During the reported quarter, the company repurchased roughly $29 million of its common stock. Since the inception of its repurchase program, the company has repurchased 17.3 million shares for a total of $469 million.
2021 Outlook
For 2021, the company projects EPS in the range of $2.40-$2.60 per share and adjusted EPS of $2.65-$2.85 per share. The company envisions generating free cash flow of minimum $800 million. The company is targeting free cash flow conversion of EBITDA at 55-60%.
Zacks Rank & Stocks to Consider
LKQ Corp currently carries a Zacks Rank #3 (Hold).
A few better-ranked stocks in the auto sector are American Axle (AXL - Free Report) , Meritor Inc and Toyota Motor (TM - Free Report) , all of which sport a Zacks Rank of 1 (Strong Buy), at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Zacks Names “Single Best Pick to Double”
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
You know this company from its past glory days, but few would expect that it’s poised for a monster turnaround. Fresh from a successful repositioning and flush with A-list celeb endorsements, it could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in a little more than 9 months and Nvidia which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>