LKQ CORP (LKQ) Stock Fundamental Analysis
NASDAQ:LKQ - Nasdaq - US5018892084 - Common Stock
We assign a fundamental rating of 5 out of 10 to LKQ. LKQ was compared to 15 industry peers in the Distributors industry. While LKQ is still in line with the averages on profitability rating, there are concerns on its financial health. LKQ has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
LKQ had positive earnings in the past year.
In the past year LKQ had a positive cash flow from operations.
Each year in the past 5 years LKQ has been profitable.
Each year in the past 5 years LKQ had a positive operating cash flow.
1.2 Ratios
LKQ has a Return On Assets (4.60%) which is in line with its industry peers.
LKQ has a better Return On Equity (11.41%) than 64.29% of its industry peers.
LKQ has a Return On Invested Capital (8.01%) which is comparable to the rest of the industry.
Measured over the past 3 years, the Average Return On Invested Capital for LKQ is significantly below the industry average of 18.88%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.6% | ||
| ROE | 11.41% | ||
| ROIC | 8.01% |
ROA(3y)8.14%
ROA(5y)6.76%
ROE(3y)18.38%
ROE(5y)15.45%
ROIC(3y)10.29%
ROIC(5y)9.09%
1.3 Margins
LKQ's Profit Margin of 4.90% is fine compared to the rest of the industry. LKQ outperforms 71.43% of its industry peers.
LKQ's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 9.19%, LKQ is in the better half of the industry, outperforming 71.43% of the companies in the same industry.
In the last couple of years the Operating Margin of LKQ has grown nicely.
LKQ's Gross Margin of 39.33% is fine compared to the rest of the industry. LKQ outperforms 78.57% of its industry peers.
In the last couple of years the Gross Margin of LKQ has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 9.19% | ||
| PM (TTM) | 4.9% | ||
| GM | 39.33% |
OM growth 3Y4.27%
OM growth 5Y5.2%
PM growth 3Y7.16%
PM growth 5Y10.8%
GM growth 3Y0.62%
GM growth 5Y0.88%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so LKQ is destroying value.
Compared to 1 year ago, LKQ has about the same amount of shares outstanding.
The number of shares outstanding for LKQ has been reduced compared to 5 years ago.
Compared to 1 year ago, LKQ has a worse debt to assets ratio.
2.2 Solvency
LKQ has an Altman-Z score of 2.74. This is not the best score and indicates that LKQ is in the grey zone with still only limited risk for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 2.74, LKQ is in line with its industry, outperforming 42.86% of the companies in the same industry.
LKQ has a debt to FCF ratio of 5.80. This is a neutral value as LKQ would need 5.80 years to pay back of all of its debts.
LKQ has a worse Debt to FCF ratio (5.80) than 64.29% of its industry peers.
LKQ has a Debt/Equity ratio of 0.69. This is a neutral value indicating LKQ is somewhat dependend on debt financing.
LKQ's Debt to Equity ratio of 0.69 is in line compared to the rest of the industry. LKQ outperforms 42.86% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.69 | ||
| Debt/FCF | 5.8 | ||
| Altman-Z | 2.74 |
ROIC/WACC0.64
WACC12.53%
2.3 Liquidity
A Current Ratio of 1.72 indicates that LKQ should not have too much problems paying its short term obligations.
LKQ has a Current ratio of 1.72. This is comparable to the rest of the industry: LKQ outperforms 42.86% of its industry peers.
A Quick Ratio of 0.67 indicates that LKQ may have some problems paying its short term obligations.
LKQ has a Quick ratio of 0.67. This is comparable to the rest of the industry: LKQ outperforms 42.86% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.72 | ||
| Quick Ratio | 0.67 |
3. Growth
3.1 Past
The earnings per share for LKQ have decreased by -6.63% in the last year.
The Earnings Per Share has been growing by 11.73% on average over the past years. This is quite good.
Looking at the last year, LKQ shows a quite strong growth in Revenue. The Revenue has grown by 8.48% in the last year.
LKQ shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 3.15% yearly.
EPS 1Y (TTM)-6.63%
EPS 3Y14.67%
EPS 5Y11.73%
EPS Q2Q%2.33%
Revenue 1Y (TTM)8.48%
Revenue growth 3Y6.04%
Revenue growth 5Y3.15%
Sales Q2Q%0.45%
3.2 Future
Based on estimates for the next years, LKQ will show a small growth in Earnings Per Share. The EPS will grow by 2.92% on average per year.
LKQ is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 2.67% yearly.
EPS Next Y-9.68%
EPS Next 2Y-2.33%
EPS Next 3Y1.52%
EPS Next 5Y2.92%
Revenue Next Year4.46%
Revenue Next 2Y2.93%
Revenue Next 3Y2.77%
Revenue Next 5Y2.67%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 11.14, the valuation of LKQ can be described as reasonable.
Based on the Price/Earnings ratio, LKQ is valued cheaply inside the industry as 85.71% of the companies are valued more expensively.
Compared to an average S&P500 Price/Earnings ratio of 28.29, LKQ is valued rather cheaply.
Based on the Price/Forward Earnings ratio of 10.73, the valuation of LKQ can be described as reasonable.
Based on the Price/Forward Earnings ratio, LKQ is valued cheaply inside the industry as 85.71% of the companies are valued more expensively.
Compared to an average S&P500 Price/Forward Earnings ratio of 24.44, LKQ is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.14 | ||
| Fwd PE | 10.73 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of LKQ indicates a somewhat cheap valuation: LKQ is cheaper than 71.43% of the companies listed in the same industry.
LKQ's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 13.63 | ||
| EV/EBITDA | 8.18 |
4.3 Compensation for Growth
The decent profitability rating of LKQ may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)0.95
EPS Next 2Y-2.33%
EPS Next 3Y1.52%
5. Dividend
5.1 Amount
LKQ has a Yearly Dividend Yield of 3.13%.
LKQ's Dividend Yield is rather good when compared to the industry average which is at 2.55. LKQ pays more dividend than 92.86% of the companies in the same industry.
LKQ's Dividend Yield is a higher than the S&P500 average which is at 2.28.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.13% |
5.2 History
LKQ has paid a dividend for less than 5 years, so there is no long track record yet.
LKQ has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)N/A
Div Incr Years3
Div Non Decr Years3
5.3 Sustainability
LKQ pays out 45.01% of its income as dividend. This is a bit on the high side, but may be sustainable.
DP45.01%
EPS Next 2Y-2.33%
EPS Next 3Y1.52%
LKQ CORP
NASDAQ:LKQ (1/21/2025, 8:12:05 PM)
After market: 39.21 0 (0%)39.21
+0.75 (+1.95%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustryDistributors
Earnings (Last)
Earnings (Next)
Inst Owners102.03%
Inst Owner Change0.33%
Ins Owners0.45%
Ins Owner Change-0.05%
Market Cap10.19B
Analysts82.86
Price Target52.06 (32.77%)
Short Float %2.22%
Short Ratio2.52
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.13% |
Yearly Dividend1.13
Dividend Growth(5Y)N/A
DP45.01%
Div Incr Years3
Div Non Decr Years3
Ex-DateN/A
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-3.79%
Min EPS beat(2)-5.83%
Max EPS beat(2)-1.76%
EPS beat(4)1
Avg EPS beat(4)-3.17%
Min EPS beat(4)-14.51%
Max EPS beat(4)9.4%
EPS beat(8)2
Avg EPS beat(8)-3.33%
EPS beat(12)5
Avg EPS beat(12)-0.22%
EPS beat(16)9
Avg EPS beat(16)7.98%
Revenue beat(2)0
Avg Revenue beat(2)-3.68%
Min Revenue beat(2)-4.99%
Max Revenue beat(2)-2.37%
Revenue beat(4)0
Avg Revenue beat(4)-2.84%
Min Revenue beat(4)-4.99%
Max Revenue beat(4)-1.41%
Revenue beat(8)2
Avg Revenue beat(8)-1.47%
Revenue beat(12)4
Avg Revenue beat(12)-1.46%
Revenue beat(16)7
Avg Revenue beat(16)-0.04%
PT rev (1m)0%
PT rev (3m)-7.25%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-23.05%
EPS NY rev (1m)0%
EPS NY rev (3m)-4.08%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-7.04%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.92%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.14 | ||
| Fwd PE | 10.73 | ||
| P/S | 0.7 | ||
| P/FCF | 13.63 | ||
| P/OCF | 9.28 | ||
| P/B | 1.64 | ||
| P/tB | N/A | ||
| EV/EBITDA | 8.18 |
EPS(TTM)3.52
EY8.98%
EPS(NY)3.65
Fwd EY9.32%
FCF(TTM)2.88
FCFY7.34%
OCF(TTM)4.22
OCFY10.77%
SpS55.77
BVpS23.98
TBVpS-2.4
PEG (NY)N/A
PEG (5Y)0.95
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.6% | ||
| ROE | 11.41% | ||
| ROCE | 10.68% | ||
| ROIC | 8.01% | ||
| ROICexc | 8.24% | ||
| ROICexgc | 18.97% | ||
| OM | 9.19% | ||
| PM (TTM) | 4.9% | ||
| GM | 39.33% | ||
| FCFM | 5.16% |
ROA(3y)8.14%
ROA(5y)6.76%
ROE(3y)18.38%
ROE(5y)15.45%
ROIC(3y)10.29%
ROIC(5y)9.09%
ROICexc(3y)10.58%
ROICexc(5y)9.38%
ROICexgc(3y)23.45%
ROICexgc(5y)20.52%
ROCE(3y)13.74%
ROCE(5y)12.13%
ROICexcg growth 3Y11.42%
ROICexcg growth 5Y6.07%
ROICexc growth 3Y5.86%
ROICexc growth 5Y4.22%
OM growth 3Y4.27%
OM growth 5Y5.2%
PM growth 3Y7.16%
PM growth 5Y10.8%
GM growth 3Y0.62%
GM growth 5Y0.88%
F-Score6
Asset Turnover0.94
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.69 | ||
| Debt/FCF | 5.8 | ||
| Debt/EBITDA | 2.48 | ||
| Cap/Depr | 87.5% | ||
| Cap/Sales | 2.41% | ||
| Interest Coverage | 5.33 | ||
| Cash Conversion | 63.36% | ||
| Profit Quality | 105.2% | ||
| Current Ratio | 1.72 | ||
| Quick Ratio | 0.67 | ||
| Altman-Z | 2.74 |
F-Score6
WACC12.53%
ROIC/WACC0.64
Cap/Depr(3y)99.89%
Cap/Depr(5y)88.37%
Cap/Sales(3y)2.19%
Cap/Sales(5y)2.03%
Profit Quality(3y)98.16%
Profit Quality(5y)128.26%
High Growth Momentum
Growth
EPS 1Y (TTM)-6.63%
EPS 3Y14.67%
EPS 5Y11.73%
EPS Q2Q%2.33%
EPS Next Y-9.68%
EPS Next 2Y-2.33%
EPS Next 3Y1.52%
EPS Next 5Y2.92%
Revenue 1Y (TTM)8.48%
Revenue growth 3Y6.04%
Revenue growth 5Y3.15%
Sales Q2Q%0.45%
Revenue Next Year4.46%
Revenue Next 2Y2.93%
Revenue Next 3Y2.77%
Revenue Next 5Y2.67%
EBIT growth 1Y-7.17%
EBIT growth 3Y10.57%
EBIT growth 5Y8.51%
EBIT Next Year15.53%
EBIT Next 3Y8.07%
EBIT Next 5Y5.62%
FCF growth 1Y5.92%
FCF growth 3Y-7.75%
FCF growth 5Y16.72%
OCF growth 1Y8.18%
OCF growth 3Y-2.07%
OCF growth 5Y13.79%