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LKQ Corporation (LKQ - Free Report) delivered adjusted earnings of 84 cents per share for fourth-quarter 2023, which increased from 78 cents reported in the year-ago period and surpassed the Zacks Consensus Estimate of 75 cents.
The aftermarket auto parts distributor registered quarterly revenues of $3.5 billion, missing the Zacks Consensus Estimate of $3.51 billion. The top line, however, grew from the year-ago level of $3 billion. Parts and services organic revenues increased 2.8% year over year.
In the reported quarter, revenues from the Wholesale North American segment totaled $1.47 billion, rising 33% year over year and topping our estimate of $1.46 billion. The segment’s EBITDA was $239 million, which was above our forecast of $188.7 million and higher than $204 million generated in the fourth quarter of 2022.
Revenues from the European segment were $1.55 billion, which increased 11.2% year over year and beat our estimate of $1.54 billion. The segment’s EBITDA came in at $129 million, which decreased from $139 million in the year-ago period but beat our forecast of $125.2 million.
Revenues from the Specialty segment came in at $371 million, rising 1.6% year over year and beating our projection of $357.1 million. The segment’s EBITDA was $21 million, which declined from the year-ago figure of $23 million and missed our forecast of $27 million.
Revenues from the Self-Service segment totaled $118 million, down 18.1% year over year. The metric also missed our prediction of $127.2 million. The segment’s EBITDA was $7 million, which was in line with the year-ago reported figure.
Financial Position & Dividend
LKQ had cash and cash equivalents of $299 million as of Dec 31, 2023, up from $278 million recorded as of Dec 31, 2022. The long-term obligations (excluding the current portion) amounted to $3.66 billion as of Dec 31, 2023, up from $2.62 billion recorded as of Dec 31, 2022. As of Dec 31, 2023, LKQ’s balance sheet reflected a total debt of $4.3 billion.
During full-year 2023, cash flow provided by operating activities totaled $1.36 billion. The company recorded a positive free cash flow of $998 million.
During full-year 2023, the company repurchased 0.8 million shares worth $35 million. LKQ bought back 0.7 million shares for $30 million in the fourth quarter of 2023. In the period between initiating the stock buyback program in late October 2018 and Dec 31, 2023, it repurchased around 56 million shares for a total of $2.4 billion.
On Feb 20, 2023, LKQ announced a quarterly cash dividend of 30 cents per share. The dividend will be paid out on Mar 28, 2024, to stockholders of record at the close of business on Mar 14, 2024.
2024 Guidance
For full-year 2024, the company expects adjusted earnings per share (EPS) in the range of $3.90-$4.20. The company’s estimated free cash flow is pinned at approximately $1 billion. The operating cash flow projection is pegged at $1.35 billion. It forecasts organic revenue growth for parts and services between 3.5% and 5.5%.
The Zacks Consensus Estimate for MOD’s 2024 sales and earnings suggests year-over-year growth of 4% and 67.2%, respectively. The EPS estimates for 2024 and 2025 have improved 22 cents each in the past 30 days.
The Zacks Consensus Estimate for GM’s 2024 sales and earnings suggests year-over-year growth of 1.8% and 17.2%, respectively. The EPS estimates for 2024 and 2025 have improved $1.27 and $1.70, respectively, in the past 30 days.
The Zacks Consensus Estimate for OSK’s 2024 sales and earnings suggests year-over-year growth of 6.7% and 4%, respectively. The EPS estimates for 2024 and 2025 have improved 8 cents and 30 cents, respectively, in the past 30 days.
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LKQ Q4 Earnings Surpass Expectations, Revenues Rise Y/Y
LKQ Corporation (LKQ - Free Report) delivered adjusted earnings of 84 cents per share for fourth-quarter 2023, which increased from 78 cents reported in the year-ago period and surpassed the Zacks Consensus Estimate of 75 cents.
The aftermarket auto parts distributor registered quarterly revenues of $3.5 billion, missing the Zacks Consensus Estimate of $3.51 billion. The top line, however, grew from the year-ago level of $3 billion. Parts and services organic revenues increased 2.8% year over year.
LKQ Corporation Price, Consensus and EPS Surprise
LKQ Corporation price-consensus-eps-surprise-chart | LKQ Corporation Quote
Segment Highlights
In the reported quarter, revenues from the Wholesale North American segment totaled $1.47 billion, rising 33% year over year and topping our estimate of $1.46 billion. The segment’s EBITDA was $239 million, which was above our forecast of $188.7 million and higher than $204 million generated in the fourth quarter of 2022.
Revenues from the European segment were $1.55 billion, which increased 11.2% year over year and beat our estimate of $1.54 billion. The segment’s EBITDA came in at $129 million, which decreased from $139 million in the year-ago period but beat our forecast of $125.2 million.
Revenues from the Specialty segment came in at $371 million, rising 1.6% year over year and beating our projection of $357.1 million. The segment’s EBITDA was $21 million, which declined from the year-ago figure of $23 million and missed our forecast of $27 million.
Revenues from the Self-Service segment totaled $118 million, down 18.1% year over year. The metric also missed our prediction of $127.2 million. The segment’s EBITDA was $7 million, which was in line with the year-ago reported figure.
Financial Position & Dividend
LKQ had cash and cash equivalents of $299 million as of Dec 31, 2023, up from $278 million recorded as of Dec 31, 2022. The long-term obligations (excluding the current portion) amounted to $3.66 billion as of Dec 31, 2023, up from $2.62 billion recorded as of Dec 31, 2022. As of Dec 31, 2023, LKQ’s balance sheet reflected a total debt of $4.3 billion.
During full-year 2023, cash flow provided by operating activities totaled $1.36 billion. The company recorded a positive free cash flow of $998 million.
During full-year 2023, the company repurchased 0.8 million shares worth $35 million. LKQ bought back 0.7 million shares for $30 million in the fourth quarter of 2023. In the period between initiating the stock buyback program in late October 2018 and Dec 31, 2023, it repurchased around 56 million shares for a total of $2.4 billion.
On Feb 20, 2023, LKQ announced a quarterly cash dividend of 30 cents per share. The dividend will be paid out on Mar 28, 2024, to stockholders of record at the close of business on Mar 14, 2024.
2024 Guidance
For full-year 2024, the company expects adjusted earnings per share (EPS) in the range of $3.90-$4.20. The company’s estimated free cash flow is pinned at approximately $1 billion. The operating cash flow projection is pegged at $1.35 billion. It forecasts organic revenue growth for parts and services between 3.5% and 5.5%.
Zacks Rank & Key Picks
LKQ currently carries a Zacks Rank #3 (Hold).
Some better-ranked players in the auto space are Modine Manufacturing Company (MOD - Free Report) , General Motors Company (GM - Free Report) and Oshkosh Corporation (OSK - Free Report) . MOD & GM sport a Zacks Rank #1 (Strong Buy) each, while OSK carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for MOD’s 2024 sales and earnings suggests year-over-year growth of 4% and 67.2%, respectively. The EPS estimates for 2024 and 2025 have improved 22 cents each in the past 30 days.
The Zacks Consensus Estimate for GM’s 2024 sales and earnings suggests year-over-year growth of 1.8% and 17.2%, respectively. The EPS estimates for 2024 and 2025 have improved $1.27 and $1.70, respectively, in the past 30 days.
The Zacks Consensus Estimate for OSK’s 2024 sales and earnings suggests year-over-year growth of 6.7% and 4%, respectively. The EPS estimates for 2024 and 2025 have improved 8 cents and 30 cents, respectively, in the past 30 days.