LKQ delivered a mixed quarter amidst a relatively complicated and unusual operating environment. The company failed to meet Wall Street expectations in terms of revenues but delivered an earnings beat. The company has been confronted with the ongoing pandemic risk as well as issues that are associated with the uptick in the positive cases in the workforce. During the quarter, LKQ benefited from minor relief in the aftermarket and it successfully got a higher level of aftermarket collision parts shipped from Taiwan. The collision repair costs increased during the quarter. It continues to make great progress with the company’s 1 LKQ Europe program. The European segment has also been witnessing a good performance since the start. Across all the segments, the company is experiencing supply chain challenges so it could have some challenging quarters ahead. Among major developments, LKQ acquired an EV battery manufacturing operation, Bumblebee batteries and also launched a trade-only, new battery range under the company’s Starline banner. We provide the stock of LKQ a ‘Hold’ rating with a revision in the target price.
Our Report Structure:
⦁ Company Overview
⦁ Investment Thesis
⦁ Key Drivers
⦁ Historical Quarterly Statement Analysis – Income Statement & Cash Flows
⦁ Historical Quarterly Balance Sheet Analysis
⦁ Historical Annual Financial Statement Analysis
⦁ Analysis Of Key Financial Ratios
⦁ Financial Forecasts For 3 Years
⦁ Forecasting The Capital Structure & Net Debt
⦁ Discounted Cash Flow Valuation
⦁ Trading Multiples
⦁ Key Risks
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