LKQ CORP (LKQ) Stock Fundamental Analysis
NASDAQ:LKQ - Nasdaq - US5018892084 - Common Stock - Currency: USD
Overall LKQ gets a fundamental rating of 5 out of 10. We evaluated LKQ against 20 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 is cheap, but on the other hand it scores bad on growth.
1. Profitability
1.1 Basic Checks
In the past year LKQ was profitable.
LKQ had a positive operating cash flow in the past year.
LKQ had positive earnings in each of the past 5 years.
LKQ had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 4.44%, LKQ is in the better half of the industry, outperforming 65.00% of the companies in the same industry.
LKQ's Return On Equity of 10.86% is fine compared to the rest of the industry. LKQ outperforms 65.00% of its industry peers.
LKQ has a Return On Invested Capital (7.13%) which is in line with its industry peers.
LKQ had an Average Return On Invested Capital over the past 3 years of 9.30%. This is significantly below the industry average of 17.88%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.44% | ||
| ROE | 10.86% | ||
| ROIC | 7.13% |
ROA(3y)6.79%
ROA(5y)6.84%
ROE(3y)15.91%
ROE(5y)15.58%
ROIC(3y)9.3%
ROIC(5y)9.18%
1.3 Margins
LKQ's Profit Margin of 5.04% is fine compared to the rest of the industry. LKQ outperforms 75.00% of its industry peers.
LKQ's Profit Margin has improved in the last couple of years.
LKQ's Operating Margin of 8.94% is fine compared to the rest of the industry. LKQ outperforms 80.00% of its industry peers.
LKQ's Operating Margin has improved in the last couple of years.
With a decent Gross Margin value of 39.21%, LKQ is doing good in the industry, outperforming 80.00% of the companies in the same industry.
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 | 8.94% | ||
| PM (TTM) | 5.04% | ||
| GM | 39.21% |
OM growth 3Y-6.3%
OM growth 5Y3.68%
PM growth 3Y-16.76%
PM growth 5Y2.13%
GM growth 3Y-1.22%
GM growth 5Y0.2%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), LKQ is destroying value.
The number of shares outstanding for LKQ has been reduced compared to 1 year ago.
The number of shares outstanding for LKQ has been reduced compared to 5 years ago.
The debt/assets ratio for LKQ has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 2.53 indicates that LKQ is not a great score, but indicates only limited risk for bankruptcy at the moment.
LKQ's Altman-Z score of 2.53 is on the low side compared to the rest of the industry. LKQ is outperformed by 60.00% of its industry peers.
LKQ has a debt to FCF ratio of 6.55. This is a slightly negative value and a sign of low solvency as LKQ would need 6.55 years to pay back of all of its debts.
LKQ has a Debt to FCF ratio (6.55) which is comparable to the rest of the industry.
LKQ has a Debt/Equity ratio of 0.67. This is a neutral value indicating LKQ is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.67, LKQ is in line with its industry, outperforming 50.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.67 | ||
| Debt/FCF | 6.55 | ||
| Altman-Z | 2.53 |
ROIC/WACC0.74
WACC9.6%
2.3 Liquidity
A Current Ratio of 1.81 indicates that LKQ should not have too much problems paying its short term obligations.
The Current ratio of LKQ (1.81) is comparable to the rest of the industry.
A Quick Ratio of 0.69 indicates that LKQ may have some problems paying its short term obligations.
LKQ's Quick ratio of 0.69 is on the low side compared to the rest of the industry. LKQ is outperformed by 60.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.81 | ||
| Quick Ratio | 0.69 |
3. Growth
3.1 Past
The earnings per share for LKQ have decreased by -4.57% in the last year.
The Earnings Per Share has been growing by 8.08% on average over the past years. This is quite good.
Looking at the last year, LKQ shows a decrease in Revenue. The Revenue has decreased by -3.02% in the last year.
Measured over the past years, LKQ shows a small growth in Revenue. The Revenue has been growing by 2.80% on average per year.
EPS 1Y (TTM)-4.57%
EPS 3Y-4.22%
EPS 5Y8.08%
EPS Q2Q%-11.22%
Revenue 1Y (TTM)-3.02%
Revenue growth 3Y3.13%
Revenue growth 5Y2.8%
Sales Q2Q%-1.86%
3.2 Future
The Earnings Per Share is expected to grow by 6.68% on average over the next years.
LKQ is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 2.24% yearly.
EPS Next Y2.27%
EPS Next 2Y5.38%
EPS Next 3Y5.97%
EPS Next 5Y6.68%
Revenue Next Year-2.67%
Revenue Next 2Y0.38%
Revenue Next 3Y1.39%
Revenue Next 5Y2.24%
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 stable.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 9.27, which indicates a very decent valuation of LKQ.
LKQ's Price/Earnings ratio is rather cheap when compared to the industry. LKQ is cheaper than 95.00% of the companies in the same industry.
LKQ's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 26.87.
With a Price/Forward Earnings ratio of 8.01, the valuation of LKQ can be described as very reasonable.
LKQ's Price/Forward Earnings ratio is rather cheap when compared to the industry. LKQ is cheaper than 100.00% of the companies in the same industry.
LKQ's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 35.34.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.27 | ||
| Fwd PE | 8.01 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, LKQ is valued cheaper than 85.00% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, LKQ is valued a bit cheaper than the industry average as 65.00% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 11.79 | ||
| EV/EBITDA | 7.35 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The decent profitability rating of LKQ may justify a higher PE ratio.
PEG (NY)4.09
PEG (5Y)1.15
EPS Next 2Y5.38%
EPS Next 3Y5.97%
5. Dividend
5.1 Amount
LKQ has a Yearly Dividend Yield of 4.03%, which is a nice return.
In the last 3 months the price of LKQ has falen by -27.23%. A price decline artificially increases the dividend yield. It may be a sign investors do not expect the dividend to last.
LKQ's Dividend Yield is rather good when compared to the industry average which is at 2.78. LKQ pays more dividend than 100.00% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.39, LKQ pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.03% |
5.2 History
LKQ has been paying a dividend for over 5 years, so it has already some track record.
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
44.21% of the earnings are spent on dividend by LKQ. This is a bit on the high side, but may be sustainable.
DP44.21%
EPS Next 2Y5.38%
EPS Next 3Y5.97%
30.97
-0.59 (-1.87%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustryDistributors
Earnings (Last)
Earnings (Next)
Inst Owners107.14%
Inst Owner Change1.92%
Ins Owners0.38%
Ins Owner Change-0.7%
Market Cap7.97B
Analysts81.54
Price Target45.93 (48.3%)
Short Float %4.79%
Short Ratio5.08
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.03% |
Yearly Dividend1.21
Dividend Growth(5Y)N/A
DP44.21%
Div Incr Years3
Div Non Decr Years3
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-3.08%
Min EPS beat(2)-6.63%
Max EPS beat(2)0.47%
EPS beat(4)2
Avg EPS beat(4)-0.33%
Min EPS beat(4)-6.63%
Max EPS beat(4)6.61%
EPS beat(8)3
Avg EPS beat(8)-2.94%
EPS beat(12)4
Avg EPS beat(12)-2.19%
EPS beat(16)8
Avg EPS beat(16)0.94%
Revenue beat(2)0
Avg Revenue beat(2)-2.3%
Min Revenue beat(2)-3.59%
Max Revenue beat(2)-1.01%
Revenue beat(4)0
Avg Revenue beat(4)-2.33%
Min Revenue beat(4)-3.59%
Max Revenue beat(4)-1.01%
Revenue beat(8)1
Avg Revenue beat(8)-2.12%
Revenue beat(12)2
Avg Revenue beat(12)-1.91%
Revenue beat(16)4
Avg Revenue beat(16)-1.55%
PT rev (1m)-15.22%
PT rev (3m)-15.49%
EPS NQ rev (1m)-13.85%
EPS NQ rev (3m)-15.09%
EPS NY rev (1m)0%
EPS NY rev (3m)-0.51%
Revenue NQ rev (1m)-2.13%
Revenue NQ rev (3m)-1.84%
Revenue NY rev (1m)-1.34%
Revenue NY rev (3m)-1.19%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.27 | ||
| Fwd PE | 8.01 | ||
| P/S | 0.57 | ||
| P/FCF | 11.79 | ||
| P/OCF | 8.41 | ||
| P/B | 1.22 | ||
| P/tB | N/A | ||
| EV/EBITDA | 7.35 |
EPS(TTM)3.34
EY10.78%
EPS(NY)3.86
Fwd EY12.48%
FCF(TTM)2.63
FCFY8.48%
OCF(TTM)3.68
OCFY11.9%
SpS54.59
BVpS25.33
TBVpS-1.5
PEG (NY)4.09
PEG (5Y)1.15
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.44% | ||
| ROE | 10.86% | ||
| ROCE | 9.71% | ||
| ROIC | 7.13% | ||
| ROICexc | 7.29% | ||
| ROICexgc | 16.06% | ||
| OM | 8.94% | ||
| PM (TTM) | 5.04% | ||
| GM | 39.21% | ||
| FCFM | 4.81% |
ROA(3y)6.79%
ROA(5y)6.84%
ROE(3y)15.91%
ROE(5y)15.58%
ROIC(3y)9.3%
ROIC(5y)9.18%
ROICexc(3y)9.54%
ROICexc(5y)9.42%
ROICexgc(3y)21.74%
ROICexgc(5y)20.87%
ROCE(3y)12.68%
ROCE(5y)12.51%
ROICexcg growth 3Y-5.75%
ROICexcg growth 5Y4.73%
ROICexc growth 3Y-8.2%
ROICexc growth 5Y3.17%
OM growth 3Y-6.3%
OM growth 5Y3.68%
PM growth 3Y-16.76%
PM growth 5Y2.13%
GM growth 3Y-1.22%
GM growth 5Y0.2%
F-Score6
Asset Turnover0.88
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.67 | ||
| Debt/FCF | 6.55 | ||
| Debt/EBITDA | 2.64 | ||
| Cap/Depr | 66.18% | ||
| Cap/Sales | 1.94% | ||
| Interest Coverage | 5.13 | ||
| Cash Conversion | 56.87% | ||
| Profit Quality | 95.48% | ||
| Current Ratio | 1.81 | ||
| Quick Ratio | 0.69 | ||
| Altman-Z | 2.53 |
F-Score6
WACC9.6%
ROIC/WACC0.74
Cap/Depr(3y)90.97%
Cap/Depr(5y)86.79%
Cap/Sales(3y)2.16%
Cap/Sales(5y)2.04%
Profit Quality(3y)104.5%
Profit Quality(5y)122.23%
High Growth Momentum
Growth
EPS 1Y (TTM)-4.57%
EPS 3Y-4.22%
EPS 5Y8.08%
EPS Q2Q%-11.22%
EPS Next Y2.27%
EPS Next 2Y5.38%
EPS Next 3Y5.97%
EPS Next 5Y6.68%
Revenue 1Y (TTM)-3.02%
Revenue growth 3Y3.13%
Revenue growth 5Y2.8%
Sales Q2Q%-1.86%
Revenue Next Year-2.67%
Revenue Next 2Y0.38%
Revenue Next 3Y1.39%
Revenue Next 5Y2.24%
EBIT growth 1Y-6.06%
EBIT growth 3Y-3.37%
EBIT growth 5Y6.58%
EBIT Next Year18.81%
EBIT Next 3Y8.27%
EBIT Next 5Y7.5%
FCF growth 1Y-29.36%
FCF growth 3Y-8.96%
FCF growth 5Y0.29%
OCF growth 1Y-22.04%
OCF growth 3Y-6.4%
OCF growth 5Y1.05%