LKQ Earnings Prediction
The chart below shows how LKQ performed 10 days before and after its earnings report, based on data from the past quarters. Typically, LKQ sees a +2.49% change in stock price 10 days leading up to the earnings, and a +0.63% change 10 days following the report. On the earnings day itself, the stock moves by -2.46%. This data can give you a slight idea of what to expect for the next quarter's release.
LKQ Key Earning Data
2024/Q4
Year Over Year
Quarter Over Quarter
Total Revenue
3.36B
-4.11%
-6.33%
Gross Margin
36.70%
-2.13%
1.02%
Operating Margin
9.15%
10.11%
-0.97%
Net Margin
4.68%
-11.36%
-12.69%
EPS
0.60
-9.09%
-17.81%
No Data Available
LKQ Earnings Analysis
LKQ Corp Corporation (LKQ.O) Earnings Conference Call
Positive
Shareholder Capital Return: LKQ Corporation demonstrated strong capital allocation with $678 million returned to shareholders through share repurchases and dividends, exceeding their commitment to allocate at least 50% of free cash flow.
Integration Success and Synergies: The integration of FinishMaster was completed ahead of schedule, resulting in increased annualized synergies of $65 million by the end of 2026.
Record EBITDA Margin: Europe achieved a record fourth quarter EBITDA margin of 10.1%, marking the highest level of segment EBITDA dollars on record, despite challenging market conditions.
SKU Count Reduction: The company successfully reduced its SKU count in Europe, hitting its target of reviewing 50% of product brands by year-end 2024, which is expected to simplify operations and enhance procurement efficiency.
Self-Service Operations Improvement: Self-service operations showed improvement with an 8.3% segment EBITDA margin in Q4, reflecting disciplined vehicle procurement and overhead cost controls.
EBITDA Margin Improvement: LKQ's North American segment improved its EBITDA margin by 50 basis points, demonstrating operational resilience despite revenue challenges.
Auto Insurance Market Outlook: The company is optimistic about favorable trends in the auto insurance market, which could benefit their North American collision business as insurance costs are expected to moderate in 2025.
Free Cash Flow Achievement: Free cash flow for the year reached $810 million, allowing for significant shareholder returns and investments in strategic growth initiatives.
Negative
Earnings Miss Reported: LKQ Corporation missed earnings expectations with reported EPS of $0.585, falling short of the expected $0.76.
North American Revenue Decline: North American revenue declined by 8.5% per day, which was larger than previous quarters, indicating worsening performance in this segment.
European Revenue Stagnation: The organic revenue in Europe declined by 20 basis points on a per day basis, showing stagnation in growth despite some markets experiencing single-digit growth.
Specialty Segment Revenue Decline: The Specialty segment reported a 7.3% decline in organic revenue per day, indicating ongoing demand softness and competitive pricing pressures.
EPS Decline Analysis: The adjusted diluted EPS for the full year decreased by $0.35 compared to 2023, primarily due to increased interest and tax impacts, as well as commodity prices and foreign exchange rates.
Aftermarket Revenue Decline: The North American aftermarket business faced a decline in organic revenue due to reduced repairable claim counts, adversely impacting margins.
Specialty Segment EBITDA Decline: The Specialty segment's EBITDA margin dropped to 4.1%, 160 basis points below the prior year, driven by revenue declines and overhead cost leverage effects.
Repairable Claims Challenges: The company anticipates headwinds on repairable claims and salvage margins to continue in 2025, particularly in the first half of the year.
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LKQ Earning Call Sentiment
LKQ Corporation (NASDAQ:LKQ) Q4 2024 Earnings Call Transcript
LKQ.O
-2.96%Positive
The earnings call presents a mixed picture: while there are positive aspects such as share repurchases, improved EBITDA margins in North America and Europe, and a commitment to shareholder returns, there are also challenges including slower EV transition, inflationary pressures, and a decrease in EPS. The Q&A section does not significantly alter the sentiment, as management's responses were cautious and lacked specifics. The adjusted guidance and ongoing challenges suggest a neutral impact on the stock price, as positive and negative factors seem to balance each other out.
