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LKQ Earnings Drive Past Estimates in Q1, Revenues Miss Mark
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LKQ Corporation’s (LKQ - Free Report) first-quarter 2019 adjusted earnings were 56 cents per share, which rose 2% from 55 cents recorded in the prior-year quarter. Further, the figure surpassed the Zacks Consensus Estimate of 55 cents. Improvement in North America gross margin along with pricing initiatives to offset inflationary pressures aided year-over-year earnings growth.
Adjusted net income was $176 million, marking 4% rise from $170 million recorded in the same period of 2018.
In the first quarter, revenues rose 14% to $3.1 billion from $2.7 billion a year ago. However, the figure narrowly missed the Zacks Consensus Estimate of $3.17 billion. The company witnessed 0.1% organic revenue growth in parts and services while acquisition revenue growth was 18.3%.
LKQ had cash and cash equivalents of $316 million as of Mar 31, 2019, compared with $332 million as of Dec 31, 2018.
At the end of first-quarter 2019, the company had net cash provided by operating activities of $177 million compared with $145 million as of Dec 31, 2018. Free cash flow improved 50% year over year to $124 million.
Share Buyback
During the quarter under review, LKQ repurchased roughly 2.6 million shares for $70 million at average price of $26.66. Since the initiation of share repurchase in October 2018, the company has bought back 4.9 million shares for $130 million.
2019 Outlook
For 2019, LKQ lowered the projection for earnings per share to $1.87-$2.00 compared with previously mentioned $2.05-$2.17. However, organic revenue growth projection for parts & services remained unchanged at 2-4%. Further, adjusted net income was unaltered at $732-$771 million.
Volvo has an expected long-term growth rate of 5%. The stock has gained 16.7% in the past three months.
PACCAR has an expected long-term growth rate of 8.4%. The stock has gained 14% in the past three months.
Fox Factory has an expected long-term growth rate of 15.1%. Over the past three months, shares of the company have gained 27.9%.
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LKQ Earnings Drive Past Estimates in Q1, Revenues Miss Mark
LKQ Corporation’s (LKQ - Free Report) first-quarter 2019 adjusted earnings were 56 cents per share, which rose 2% from 55 cents recorded in the prior-year quarter. Further, the figure surpassed the Zacks Consensus Estimate of 55 cents. Improvement in North America gross margin along with pricing initiatives to offset inflationary pressures aided year-over-year earnings growth.
Adjusted net income was $176 million, marking 4% rise from $170 million recorded in the same period of 2018.
In the first quarter, revenues rose 14% to $3.1 billion from $2.7 billion a year ago. However, the figure narrowly missed the Zacks Consensus Estimate of $3.17 billion. The company witnessed 0.1% organic revenue growth in parts and services while acquisition revenue growth was 18.3%.
LKQ Corporation Price, Consensus and EPS Surprise
LKQ Corporation Price, Consensus and EPS Surprise | LKQ Corporation Quote
Financial Position
LKQ had cash and cash equivalents of $316 million as of Mar 31, 2019, compared with $332 million as of Dec 31, 2018.
At the end of first-quarter 2019, the company had net cash provided by operating activities of $177 million compared with $145 million as of Dec 31, 2018. Free cash flow improved 50% year over year to $124 million.
Share Buyback
During the quarter under review, LKQ repurchased roughly 2.6 million shares for $70 million at average price of $26.66. Since the initiation of share repurchase in October 2018, the company has bought back 4.9 million shares for $130 million.
2019 Outlook
For 2019, LKQ lowered the projection for earnings per share to $1.87-$2.00 compared with previously mentioned $2.05-$2.17. However, organic revenue growth projection for parts & services remained unchanged at 2-4%. Further, adjusted net income was unaltered at $732-$771 million.
Zacks Rank & Stocks to Consider
LKQ currently carries a Zacks Rank #3 (Hold). A few better-ranked stocks in the broader auto sector are AB Volvo (VLVLY - Free Report) , PACCAR Inc. (PCAR - Free Report) and Fox Factory Holding Corporation (FOXF - Free Report) , each currently carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Volvo has an expected long-term growth rate of 5%. The stock has gained 16.7% in the past three months.
PACCAR has an expected long-term growth rate of 8.4%. The stock has gained 14% in the past three months.
Fox Factory has an expected long-term growth rate of 15.1%. Over the past three months, shares of the company have gained 27.9%.
Radical New Technology Creates $12.3 Trillion Opportunity
Imagine buying Microsoft stock in the early days of personal computers… or Motorola after it released the world’s first cell phone. These technologies changed our lives and created massive profits for investors.
Today, we’re on the brink of the next quantum leap in technology. 7 innovative companies are leading this “4th Industrial Revolution” - and early investors stand to earn the biggest profits.
See the 7 breakthrough stocks now>>