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LKQ Corp (LKQ) Q2 Earnings & Sales Beat Estimates, Down Y/Y

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LKQ Corporation (LKQ - Free Report) reported adjusted earnings of 53 cents per share in second-quarter 2020, surpassing the Zacks Consensus Estimate of 14 cents. However, the bottom line decreased 18.5% year over year. Lower year-over-year revenues and EBITDA across all the segments led to this underperformance.

Quarterly revenues came in at 2,626.3 million, topping the Zacks Consensus Estimate of $2,373 million. However, the top line decreased from the year-ago level of $3,248.2 million. Parts and services organic growth also fell 16.18% year over year.

LKQ Corporation Price, Consensus and EPS Surprise

LKQ Corporation Price, Consensus and EPS Surprise

LKQ Corporation price-consensus-eps-surprise-chart | LKQ Corporation Quote

Segment Highlights

Revenues from the North American unit totaled $892.8 million, down from $1,165.5 million recorded in the prior-year quarter. EBITDA from the segment came in at 149.5 million, down 21.3% year over year.

Revenues from the European segment totaled $1,206.3 million, down from $1,511 million recorded in the prior-year quarter. EBITDA from the segment came in at $89.4 million, down 23.1% year over year.

Revenues and EBITDA from the Specialty segment came in at $404 million and $52.2 million, down from the year-ago respective figures of $410.3 million and $52.4 million.

Financial Position

LKQ Corp. had cash and cash equivalents of $476.4 million as of Jun 30, 2020, down from $523 million recorded as of Dec 31, 2019. Long-term debt amounted to $1,112.2 million, down from $1,137.6 recorded as of Dec 31, 2019. During the quarter under review, the company generated net cash of $718 million from operations, up 56% from the year-ago period. It generated free cash flow of $686 million in the quarter, up 66% year over year.

Zacks Rank & Key Picks

LKQ Corp. currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the auto sector include Sonic Automotive Inc. (SAH - Free Report) , AutoNation (AN - Free Report) and LCI Industries (LCII - Free Report) . While Sonic Automotive and AutoNation flaunt a Zacks Rank of 1 (Strong Buy), LCI Industries carries a Zacks Rank of 2 (Buy), at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Shares of Sonic Automotive have climbed 38.6%, year to date, compared with the industry’s rise of 8%.

Shares of AutoNation have rallied 11.4%, year to date, compared with the industry’s gain of 7.9%.

Shares of LCI Industries have appreciated 15%, year to date, as against the industry’s decline of 7%.

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