LKQ Corp. (LKQ) Stock Recommendation | Score, Valuation, Technicals & Financial Trend

Score

Click here to find our call on this stock

Strong Sell

Sell

Hold

Buy

Strong Buy

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Comparison

Company

Score

Quality

Valuation

Financial

Technical

Dorman Products, Inc.

Visteon Corp.

XPEL, Inc.

Standard Motor Products, Inc.

Autoliv, Inc.

Gentex Corp.

Lear Corp.

LKQ Corp.

Adient plc

Fox Factory Holding Corp.

Goodyear Tire & Rubber Co.

Why is LKQ Corp. ?

High Management Efficiency with a high ROCE of 15.15%

Company's ability to service its debt is strong with a healthy EBIT to Interest (avg) ratio of 12.44

Flat results in Jun 25

OPERATING CASH FLOW(Y) Lowest at USD 948 MM
ROCE(HY) Lowest at 11.2%
CASH AND EQV(HY) Lowest at USD 516 MM

With ROCE of 12.46%, it has a very expensive valuation with a 1.48 Enterprise value to Capital Employed

The stock is trading at a fair value compared to its peers' average historical valuations
Over the past year, while the stock has generated a return of -25.18%, its profits have fallen by -11.7%

High Institutional Holdings at 100%

These investors have better capability and resources to analyse fundamentals of companies than most retail investors.

Consistent Underperformance against the benchmark over the last 3 years

Along with generating -25.18% returns in the last 1 year, the stock has also underperformed S&P 500 in each of the last 3 annual periods

Real-Time Research Report

Verdict Report

How much should you hold?

Overall Portfolio exposure to LKQ Corp. should be less than 10%
Overall Portfolio exposure to Auto Components & Equipments should be less than 30%

(If sector exposure > 30%, please use optimiser tool to see which are the best stocks to hold in Auto Components & Equipments)

When to exit? - We will constantly monitor the company and suggest at the appropriate time to exit from the stock

Is LKQ Corp. for you?

Medium Risk, Low Return

Absolute

Risk Adjusted

Volatility

LKQ Corp.

-26.76%

-0.86

34.06%

S&P 500

13.22%

0.61

20.17%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

3.57%

EBIT Growth (5y)

6.34%

EBIT to Interest (avg)

12.44

Debt to EBITDA (avg)

1.89

Net Debt to Equity (avg)

0.72

Sales to Capital Employed (avg)

1.33

Tax Ratio

27.83%

Dividend Payout Ratio

45.90%

Pledged Shares

Institutional Holding

100.00%

ROCE (avg)

15.15%

ROE (avg)

16.28%

Valuation

Valuation Scorecard

Valuation grade scale :

Very Risky, Risky, Very Expensive, Expensive, Fair, Attractive, Very Attractive

Valuation Key Factors

Factor

Value

P/E Ratio

Industry P/E

Price to Book Value

1.82

EV to EBIT

11.86

EV to EBITDA

9.07

EV to Capital Employed

1.48

EV to Sales

1.11

PEG Ratio

Dividend Yield

285.73%

ROCE (Latest)

12.46%

ROE (Latest)

12.83%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Mildly Bullish

Bearish

RSI

No Signal

Bollinger Bands

Mildly Bearish

Bearish

Moving Averages

Bearish (Daily)

KST

Mildly Bullish

Bearish

Dow Theory

No Trend

OBV

Mildly Bullish

Technical Indicator Scale: Bearish, Mildly Bearish, Sideways, Mildly Bullish, Bullish Turned

Technical Movement

Analyse All Technical Factors

Financial Trend

Financial Trend Scorecard

Financial Trend scale:

Very Negative, Negative, Flat, Positive, Very Positive, Outstanding

2What is working for the Company

RAW MATERIAL COST(Y)

Fallen by 1.29% (YoY

EPS(Q)

Highest at USD 0.74

-8What is not working for the Company

OPERATING CASH FLOW(Y)

Lowest at USD 948 MM

ROCE(HY)

Lowest at 11.2%

CASH AND EQV(HY)

Lowest at USD 516 MM

INVENTORY TURNOVER RATIO(HY)

Lowest at 2.76 times

DEBTORS TURNOVER RATIO(HY)

Lowest at 10.03 times

Here's what is working for LKQ Corp.

EPS

Highest at USD 0.74

in the last five periods

MOJO Watch

Increasing profitability; company has created higher earnings for shareholders

EPS (USD)

Raw Material Cost

Fallen by 1.29% (YoY)

MOJO Watch

The company's ability to pass on the cost of raw materials to customers has improved; this may lead to a rise in profit margin

Raw Material Cost as a percentage of Sales

Here's what is not working for LKQ Corp.

Operating Cash Flow

Lowest at USD 948 MM and Fallen

In each year in the last three years

MOJO Watch

The company's cash revenues from business operations are falling

Operating Cash Flows (USD MM)

Cash and Eqv

Lowest at USD 516 MM

in the last six Semi-Annual periods

MOJO Watch

Short Term liquidity is deteriorating

Cash and Cash Equivalents

Inventory Turnover Ratio

Lowest at 2.76 times

in the last five Semi-Annual periods

MOJO Watch

Company's pace of selling inventory has slowed

Inventory Turnover Ratio

Debtors Turnover Ratio

Lowest at 10.03 times

in the last five Semi-Annual periods

MOJO Watch

Company's pace of selling Debtors has slowed

Debtors Turnover Ratio