LKQ (NASDAQ:LKQ) Issues Quarterly Earnings Results

Key Points

• LKQ missed quarterly expectations: Adjusted EPS was $0.50 versus the $0.61 consensus, while revenue fell 5.1% year over year to $3.32 billion, down from $0.84 EPS in the prior-year quarter.
• Europe was the main weakness: Organic revenue declined 9.8%, with a German ERP disruption reducing quarterly EBITDA by an estimated $43 million. LKQ suspended full-year 2026 guidance and paused its strategic review amid the deterioration.
• Management launched an operational reset: Sal Abbate will become CEO in December, while Alvarez & Marsal was hired to stabilize European operations. North America and Specialty provided some resilience, and LKQ reported $411 million in operating cash flow and $1.7 billion of liquidity.

LKQ (NASDAQ:LKQ - Get Free Report) posted its earnings results on Thursday. The auto parts company reported $0.50 earnings per share for the quarter, missing analysts' consensus estimates of $0.61 by ($0.11), FiscalAI reports. The company had revenue of $3.32 billion for the quarter, compared to analysts' expectations of $3.36 billion. LKQ had a return on equity of 10.84% and a net margin of 3.37%. The firm's quarterly revenue was down 5.1% on a year-over-year basis. During the same quarter in the prior year, the company earned $0.84 EPS.

Here are the key takeaways from LKQ's conference call:

• Third-quarter results deteriorated sharply: Revenue fell 5.1% to approximately $3.3 billion, adjusted EPS declined to $0.50 from $0.84, and GAAP EPS was a $0.09 loss. Full-year 2026 guidance was suspended due to weak performance and the leadership transition.
• Europe remained the primary drag. Organic revenue declined 9.8%, segment EBITDA fell $94 million year over year to $68 million, and the ERP disruption in Germany reduced quarterly EBITDA by an estimated $43 million; issues in the U.K. and Benelux also caused market-share losses.
• The board appointed Sal Abbate as CEO effective December 15, engaged Alvarez & Marsal to stabilize European operations, and suspended the strategic review, including the Specialty sale process. These actions prioritize operational recovery but remove near-term clarity around potential strategic value realization.
• North America showed resilience despite soft demand. Organic revenue declined 2.4%, but segment EBITDA margin expanded 40 basis points to 14.4% through pricing and cost discipline, while alternative-part utilization reached a record nearly 41%.
• Specialty delivered 0.9% organic revenue growth despite pressure from higher fuel costs, interest rates and trade tensions, while third-quarter operating cash flow reached $411 million and free cash flow was $372 million. LKQ ended the quarter with approximately $1.7 billion of liquidity and no significant debt maturities until 2028.

LKQ Stock Performance

Shares of LKQ traded up $0.49 during trading hours on Thursday, hitting $17.68. The stock had a trading volume of 4,744,733 shares, compared to its average volume of 3,197,794. The firm has a market capitalization of $4.47 billion, a price-to-earnings ratio of 9.81 and a beta of 0.87. The company has a debt-to-equity ratio of 0.52, a quick ratio of 0.61 and a current ratio of 1.58. The firm has a 50-day moving average price of $23.07 and a 200 day moving average price of $27.37. LKQ has a fifty-two week low of $16.85 and a fifty-two week high of $37.13.

LKQ News Roundup

Here are the key news stories impacting LKQ this week:

• Positive Sentiment: LKQ reported adjusted third-quarter earnings of $0.50 per share, exceeding the Zacks consensus estimate of $0.48. The result may provide some support, although it was below the $0.84 earned in the year-ago quarter. LKQ Beats Q3 Earnings Estimates
• Positive Sentiment: Barclays upgraded LKQ to Overweight from Equal Weight, offering a more favorable analyst view that could help sentiment, particularly after the stock’s steep decline and relatively low valuation. LKQ Raised to Overweight at Barclays
• Neutral Sentiment: Management is launching a strategic and operational reset. This could improve profitability over time, but the benefits are not yet visible and execution remains a key risk. LKQ Reports Q3 Loss and Launches Reset
• Negative Sentiment: LKQ suspended its full-year 2026 guidance and paused its strategic review as European results lagged. Removing financial guidance makes valuation and earnings expectations more difficult for investors to assess. LKQ Suspends Guidance and Pauses Strategic Review
• Negative Sentiment: Third-quarter revenue was approximately $3.32 billion, below the $3.36 billion analyst estimate and down 5.1% year over year. LKQ also missed the broader consensus EPS estimate of $0.61, highlighting pressure on both sales and profitability. LKQ Third-Quarter Results
• Negative Sentiment: Barclays’ upgrade was partly offset by a Baird price-target reduction, a Zacks Strong Sell rating, and a securities-law investigation announcement. These developments add caution around LKQ’s outlook and governance. LKQ Investor Investigation

Wall Street Analysts Forecast Growth

A number of analysts recently commented on LKQ shares. Raymond James Financial set a $30.00 target price on shares of LKQ in a research note on Friday, July 31st. JPMorgan Chase & Co. decreased their price target on shares of LKQ from $30.00 to $27.00 and set an "overweight" rating for the company in a report on Thursday, October 8th. Robert W. Baird lowered their price objective on shares of LKQ from $30.00 to $23.00 and set an "outperform" rating for the company in a research note on Monday. Weiss Ratings lowered shares of LKQ from a "hold (c-)" rating to a "sell (d+)" rating in a report on Thursday, August 13th. Finally, Jefferies Financial Group reissued a "buy" rating and set a $30.00 price objective on shares of LKQ in a report on Friday, October 23rd. Five analysts have rated the stock with a Buy rating, two have given a Hold rating and two have assigned a Sell rating to the company's stock. Based on data from MarketBeat, the stock has an average rating of "Hold" and an average price target of $27.07.

About LKQ

LKQ Corporation is a global distributor of automotive parts and accessories. The company supplies replacement parts, components and equipment to professional repair shops, collision-repair businesses, insurers, dealerships and other commercial customers. Its product offerings include recycled original-equipment parts, aftermarket parts, specialty vehicle products, tools and equipment.

LKQ's operations include the procurement, dismantling and distribution of salvaged vehicles, allowing it to provide recycled engines, transmissions, body panels and other components.

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