Comparing Genuine Parts (GPC) & LKQ Corporation (LKQ)

LKQ Corporation (NASDAQ: LKQ) and Genuine Parts (NYSE:GPC) are both large-cap auto/tires/trucks companies, but which is the superior business? We will compare the two companies based on the strength of their earnings, valuation, dividends, profitability, institutional ownership, risk and analyst recommendations.

Dividends

Genuine Parts pays an annual dividend of $2.70 per share and has a dividend yield of 3.3%. LKQ Corporation does not pay a dividend. Genuine Parts pays out 58.3% of its earnings in the form of a dividend. LKQ Corporation has raised its dividend for 60 consecutive years.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for LKQ Corporation and Genuine Parts, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
LKQ Corporation 0 1 6 0 2.86
Genuine Parts 1 5 1 0 2.00

LKQ Corporation currently has a consensus price target of $39.20, indicating a potential upside of 15.91%. Genuine Parts has a consensus price target of $96.86, indicating a potential upside of 16.96%. Given Genuine Parts’ higher probable upside, analysts clearly believe Genuine Parts is more favorable than LKQ Corporation.

Profitability

This table compares LKQ Corporation and Genuine Parts’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
LKQ Corporation 5.31% 15.74% 6.82%
Genuine Parts 4.37% 21.05% 7.60%

Valuation & Earnings

This table compares LKQ Corporation and Genuine Parts’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
LKQ Corporation $9.16 billion 1.14 $1.06 billion $1.61 21.01
Genuine Parts $15.73 billion 0.77 $1.22 billion $4.63 17.89

Genuine Parts has higher revenue and earnings than LKQ Corporation. Genuine Parts is trading at a lower price-to-earnings ratio than LKQ Corporation, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

LKQ Corporation has a beta of 0.84, indicating that its stock price is 16% less volatile than the S&P 500. Comparatively, Genuine Parts has a beta of 1.04, indicating that its stock price is 4% more volatile than the S&P 500.

Insider & Institutional Ownership

91.8% of LKQ Corporation shares are owned by institutional investors. Comparatively, 73.3% of Genuine Parts shares are owned by institutional investors. 1.1% of LKQ Corporation shares are owned by company insiders. Comparatively, 3.1% of Genuine Parts shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Summary

Genuine Parts beats LKQ Corporation on 9 of the 17 factors compared between the two stocks.

LKQ Corporation Company Profile

LKQ Corporation (LKQ) is a distributor of vehicle products, including replacement parts, components and systems used in the repair and maintenance of vehicles, as well as specialty vehicle products and accessories, and automotive glass products. The Company’s segments include Wholesale-North America; Europe; Specialty, and Self Service. It offers its customers a range of replacement systems, components, equipment and parts to repair and accessorize automobiles, trucks, and recreational and performance vehicles. It distributes a range of products to collision and mechanical repair shops, including aftermarket collision and mechanical products, recycled collision and mechanical products, refurbished collision products, such as wheels, bumper covers and lights, and re-manufactured engines. It also has operations in North America, Europe and Taiwan. It is a provider of alternative vehicle collision replacement products and alternative vehicle mechanical replacement products.

Genuine Parts Company Profile

Genuine Parts Company is a service organization engaged in the distribution of automotive replacement parts, industrial replacement parts, office products and electrical/electronic materials. The Company’s segments include Automotive, Industrial, Office Products Group, Electrical/Electronic Materials and Other. The automotive segment distributes replacement parts for all makes and models of automobiles, trucks and other vehicles. The industrial segment distributes a range of industrial bearings, mechanical and fluid power transmission equipment, including hydraulic and pneumatic products, material handling components and related parts and supplies. The office products segment distributes a range of office products, computer supplies, office furniture, and business electronics. The electrical/electronic materials segment distributes a range of electrical/electronic materials, including insulating and conductive materials for use in electronic and electrical apparatus.

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