First Week of LKQ May 2025 Options Trading
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Sep 20 2024
0mins
Source: NASDAQ.COM
Put Contract Analysis: The $40.00 put contract for LKQ stock offers a premium of $3.30, allowing investors to potentially buy shares at an effective cost of $36.70, with a 58% chance of the contract expiring worthless, yielding an 8.25% return on cash commitment.
Call Contract Strategy: The $42.50 call contract provides a premium of $2.85, enabling investors who purchase shares at $40.32 to achieve a total return of 12.48% if the stock is called away, with a 52% chance of the contract expiring worthless, offering a potential 7.07% additional return.
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Analyst Views on LKQ
Wall Street analysts forecast LKQ stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for LKQ is 41.25 USD with a low forecast of 33.00 USD and a high forecast of 50.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
6 Analyst Rating
5 Buy
1 Hold
0 Sell
Strong Buy
Current: 32.570
Low
33.00
Averages
41.25
High
50.00
Current: 32.570
Low
33.00
Averages
41.25
High
50.00
About LKQ
LKQ Corporation is a provider of alternative and specialty parts to repair and accessorize automobiles and other vehicles. The Company offers its customers a range of original equipment manufacturer (OEM) recycled and aftermarket parts, replacement systems, components, equipment, and services. Its Wholesale - North America segment provides alternative vehicle collision replacement products, paint and body repair related products, and alternative vehicle mechanical replacement products, with its sales, processing, and distribution facilities reaching major markets in the United States and Canada. Its Europe segment provides alternative vehicle replacement and maintenance products in Germany, the United Kingdom, the Benelux region (Belgium, Netherlands, and Luxembourg), Italy, Czech Republic, Austria, Slovakia, France and other European countries. Its Specialty segment is a distributor of specialty vehicle aftermarket equipment and accessories across the United States and Canada.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
LKQ Explores Strategic Alternatives, Potential Share Value in Low-to-Mid $50s
- Acquisition Potential Analysis: LKQ Corp. is exploring strategic alternatives, including a potential sale, with analysts suggesting a share value in the low-to-mid $50s, indicating significant long-term value potential.
- Financial Expectations Assessment: Based on 2025 financial expectations, the North American wholesale segment is valued at $5.7bn to $6.1bn, Europe at $3.0bn to $3.4bn, and Specialty at $500mn to $700mn, showcasing the potential value of the company's segments.
- Market Reaction: LKQ's shares rose by 0.4%, reflecting a positive market response to its strategic alternatives, despite facing near-term challenges in North American and European markets.
- Overall Valuation Outlook: Analysts believe LKQ's enterprise value could exceed $13bn, factoring in $4.2bn in debt and $289mn in cash, indicating significant upside potential from the current share price of $34.
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LKQ Corp. Initiates Strategic Alternatives Review
- Strategic Review Initiated: LKQ Corp.'s board has commenced a review of strategic alternatives, which may include a potential sale of the company, aimed at maximizing shareholder returns and enhancing current valuation.
- Management Commitment: Chairman John Mendel stated that management will continually assess the company's performance and strategic positioning to identify value not reflected in the current valuation.
- Advisory Engagement: LKQ has engaged BofA Securities as its financial advisor and Wachtell, Lipton, Rosen & Katz as its legal counsel to support the strategic review process.
- Focus on Specialty Division: The company continues with its previously announced plan to explore the potential sale of its specialty segment, although no specific timetable for the completion of the review has been set.
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