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LKQ Corp (LKQ) Q1 Earnings: Is a Disappointment in Store?
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LKQ Corporation (LKQ - Free Report) will release its first-quarter fiscal 2017 results, before the market opens, on Apr 27.
Last quarter, LKQ Corp. missed estimates by 12.5%. The company has managed to beat earnings in one of the trailing four quarters, miss in one and come in line in two, delivering an average positive surprise of 0.52% over this period.
Let’s see how things are shaping up for this announcement.
LKQ Corp’s gross margins are under pressure due to its recent acquisitions. Rhiag and Pittsburgh Glass Works have lower gross margins than the company’s historical levels, which has been affecting the overall number.
The company’s acquisition of Andrew Page is also adversely impacting the company’s earnings. Andrew Page is expected to lower overall earnings by at least $0.01 in 2017. The company is also exposed to currency fluctuations that have been lowering the bottom line. Currency headwinds are expected in the first half of 2017.
LKQ Corp.’s shares lost 6.8% in the last three months, underperforming the Zacks categorized Auto/Truck Replacement Parts industry’s decline of 3.7%.
Earnings Whispers
Our proven model does not conclusively show that LKQ Corp is likely to beat estimates this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. This is not the case here, as you will see below:
Zacks ESP: Earnings ESP for LKQ Corp. is currently -6.52%. This is because the Most Accurate estimate is 43 cents while the Zacks Consensus Estimate stands at 46 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: LKQ Corp. currently carries a Zacks Rank #4 (Sell). We caution against Sell-rated stocks (#4 or 5) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks that Warrant a Look
Here are some companies you may want to consider as our model shows that these have the right combination of elements to post an earnings beat this quarter:
Autoliv Inc. (ALV - Free Report) has an Earnings ESP of +1.97% and a Zacks Rank #3. The company’s first-quarter 2017 financial results are scheduled for release on Apr 28.
Delphi Automotive PLC has an Earnings ESP of +2.06% and a Zacks Rank #2. The company is scheduled to report first-quarter 2017 financial numbers on May 3.
Zacks’ Best Private Investment Ideas
While we are happy to share many articles like this on the website, our best recommendations and most in-depth research are not available to the public.
Starting today, for the next month, you can follow all Zacks' private buys and sells in real time. Our experts cover all kinds of trades… from value to momentum . . . from stocks under $10 to ETF and option moves . . . from stocks that corporate insiders are buying up to companies that are about to report positive earnings surprises. You can even look inside exclusive portfolios that are normally closed to new investors.
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LKQ Corp (LKQ) Q1 Earnings: Is a Disappointment in Store?
LKQ Corporation (LKQ - Free Report) will release its first-quarter fiscal 2017 results, before the market opens, on Apr 27.
Last quarter, LKQ Corp. missed estimates by 12.5%. The company has managed to beat earnings in one of the trailing four quarters, miss in one and come in line in two, delivering an average positive surprise of 0.52% over this period.
Let’s see how things are shaping up for this announcement.
LKQ Corporation Price and EPS Surprise
LKQ Corporation Price and EPS Surprise | LKQ Corporation Quote
Factors to Consider
LKQ Corp’s gross margins are under pressure due to its recent acquisitions. Rhiag and Pittsburgh Glass Works have lower gross margins than the company’s historical levels, which has been affecting the overall number.
The company’s acquisition of Andrew Page is also adversely impacting the company’s earnings. Andrew Page is expected to lower overall earnings by at least $0.01 in 2017. The company is also exposed to currency fluctuations that have been lowering the bottom line. Currency headwinds are expected in the first half of 2017.
LKQ Corp.’s shares lost 6.8% in the last three months, underperforming the Zacks categorized Auto/Truck Replacement Parts industry’s decline of 3.7%.
Earnings Whispers
Our proven model does not conclusively show that LKQ Corp is likely to beat estimates this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. This is not the case here, as you will see below:
Zacks ESP: Earnings ESP for LKQ Corp. is currently -6.52%. This is because the Most Accurate estimate is 43 cents while the Zacks Consensus Estimate stands at 46 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: LKQ Corp. currently carries a Zacks Rank #4 (Sell). We caution against Sell-rated stocks (#4 or 5) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks that Warrant a Look
Here are some companies you may want to consider as our model shows that these have the right combination of elements to post an earnings beat this quarter:
CNH Industrial N.V. has an Earnings ESP of +33.33% and a Zacks Rank #2. The company is expected to report first-quarter 2017 results on Apr 27. You can see the complete list of today’s Zacks #1 Rank stocks here.
Autoliv Inc. (ALV - Free Report) has an Earnings ESP of +1.97% and a Zacks Rank #3. The company’s first-quarter 2017 financial results are scheduled for release on Apr 28.
Delphi Automotive PLC has an Earnings ESP of +2.06% and a Zacks Rank #2. The company is scheduled to report first-quarter 2017 financial numbers on May 3.
Zacks’ Best Private Investment Ideas
While we are happy to share many articles like this on the website, our best recommendations and most in-depth research are not available to the public.
Starting today, for the next month, you can follow all Zacks' private buys and sells in real time. Our experts cover all kinds of trades… from value to momentum . . . from stocks under $10 to ETF and option moves . . . from stocks that corporate insiders are buying up to companies that are about to report positive earnings surprises. You can even look inside exclusive portfolios that are normally closed to new investors.
Click here for Zacks' private trades >>