Genuine Parts Company (GPC - Free Report) reported earnings of $1.28 per share in second-quarter 2016, flat with the year-ago quarter. Earnings per share, however, missed the Zacks Consensus Estimate of $1.30.
The company recorded net income of $191.4 million in the second quarter of 2016, down from $195.4 million in the prior-year quarter.
Revenues in the reported quarter dropped 1% year over year to $3.90 billion and lagged the Zacks Consensus Estimate of $4.01 billion. The decline is attributable to a 1% negative currency impact, partially offset by benefits from acquisitions.
Operating profit decreased to $340.5 million from $349.4 million in the second quarter of 2015. Selling, general and administrative expenses fell to $829.5 million from $832.6 million a year ago.
Segment Results
Revenues at the Automotive Parts segment slipped 0.7% to $2.09 billion from the year-ago level of $2.10 billion. Revenues declined due to a drop in core automotive sales and currency headwinds, partially offset by benefits from acquisitions. The segment’s operating profit decreased to $203.6 million in the reported quarter from $207.4 million a year ago.
Revenues at the Motion Industries or Industrial segment dropped 1.7% to $1.17 billion owing to lower sales volume and currency headwinds, partially offset by synergies from acquisitions. Operating profit at the segment was $88.3 million, down from $88.9 million in the year-ago quarter.
The Electrical or EIS segment’s revenues fell 5% to $184.5 million due to the adverse impact of copper pricing. Operating profit decreased to $16 million from $18.6 million in the year-ago quarter.
The S. P. Richards or Office Products segment’s revenues improved 1% to $481.6 million, driven by benefits from acquisitions. Operating profit at the segment declined to $32.6 million from $34.5 million a year ago.
Financial Position
Genuine Parts had cash and cash equivalents of $233.6 million as of Jun 30, 2016, up from $223.8 million as of Jun 30, 2015. Long-term debt declined to $775 million as of Jun 30, 2016, from $850 million as of Jun 30, 2015.
In the first half of 2016, Genuine Parts’ net cash flow from operations improved to $533.5 million from $454.1 million in the prior-year period. Capital expenditures increased to $49.7 million from $37.5 million a year ago.
Guidance
For 2016, Genuine Parts expects annual revenue to improve 1%–2%. Earnings per share in 2016 are envisioned to be in the range of $4.70–$4.75 compared to the previous forecast of $4.70–$4.80.
Zacks Rank
Genuine Parts currently carries a Zacks Rank #2 (Buy).
Some other well-ranked automobile stocks include Commercial Vehicle Group Inc. (CVGI - Free Report) , Spartan Motors Inc. and U.S. Auto Parts Network, Inc. (PRTS - Free Report) , all carrying a Zacks Rank #2.
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Genuine Parts Company (GPC - Free Report) reported earnings of $1.28 per share in second-quarter 2016, flat with the year-ago quarter. Earnings per share, however, missed the Zacks Consensus Estimate of $1.30.
The company recorded net income of $191.4 million in the second quarter of 2016, down from $195.4 million in the prior-year quarter.
Revenues in the reported quarter dropped 1% year over year to $3.90 billion and lagged the Zacks Consensus Estimate of $4.01 billion. The decline is attributable to a 1% negative currency impact, partially offset by benefits from acquisitions.
Operating profit decreased to $340.5 million from $349.4 million in the second quarter of 2015. Selling, general and administrative expenses fell to $829.5 million from $832.6 million a year ago.
Segment Results
Revenues at the Automotive Parts segment slipped 0.7% to $2.09 billion from the year-ago level of $2.10 billion. Revenues declined due to a drop in core automotive sales and currency headwinds, partially offset by benefits from acquisitions. The segment’s operating profit decreased to $203.6 million in the reported quarter from $207.4 million a year ago.
Revenues at the Motion Industries or Industrial segment dropped 1.7% to $1.17 billion owing to lower sales volume and currency headwinds, partially offset by synergies from acquisitions. Operating profit at the segment was $88.3 million, down from $88.9 million in the year-ago quarter.
The Electrical or EIS segment’s revenues fell 5% to $184.5 million due to the adverse impact of copper pricing. Operating profit decreased to $16 million from $18.6 million in the year-ago quarter.
The S. P. Richards or Office Products segment’s revenues improved 1% to $481.6 million, driven by benefits from acquisitions. Operating profit at the segment declined to $32.6 million from $34.5 million a year ago.
Financial Position
Genuine Parts had cash and cash equivalents of $233.6 million as of Jun 30, 2016, up from $223.8 million as of Jun 30, 2015. Long-term debt declined to $775 million as of Jun 30, 2016, from $850 million as of Jun 30, 2015.
In the first half of 2016, Genuine Parts’ net cash flow from operations improved to $533.5 million from $454.1 million in the prior-year period. Capital expenditures increased to $49.7 million from $37.5 million a year ago.
Guidance
For 2016, Genuine Parts expects annual revenue to improve 1%–2%. Earnings per share in 2016 are envisioned to be in the range of $4.70–$4.75 compared to the previous forecast of $4.70–$4.80.
Zacks Rank
Genuine Parts currently carries a Zacks Rank #2 (Buy).
Some other well-ranked automobile stocks include Commercial Vehicle Group Inc. (CVGI - Free Report) , Spartan Motors Inc. and U.S. Auto Parts Network, Inc. (PRTS - Free Report) , all carrying a Zacks Rank #2.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>
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.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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