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Genuine Parts Company (GPC)
NYSE:GPC
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Genuine Parts Company
(NYSE:GPC)67Neutral
Positive Factors
Economic environment
Positive signs in the industrial environment include three months of sequential improvements in PMI, now out of contraction territory.
Political changes
If a Republican win ignites a manufacturing boom in the US due to prohibitive import tariffs, GPC’s Motion business should be a major beneficiary.
Negative Factors
Market competition
Despite self-help initiatives, GPC seems to be losing market share due to significant deceleration and underperformance relative to leading peers.
Genuine Parts Company (GPC) vs. S&P 500 (SPY)
Market Cap
$17.05B
Dividend Yield3.23%
Average Volume (3M)1.72M
Price to Earnings (P/E)19.0
Beta (1Y)0.79
Revenue Growth1.71%
EPS Growth-30.78%
CountryUS
Employees60,000
SectorConsumer Cyclical
Sector Strength53
IndustryVehicles
Share Statistics
EPS (TTM)6.47
Shares Outstanding138,782,030
10 Day Avg. Volume1,571,319
30 Day Avg. Volume1,719,900
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.73
Price to Cash Flow (P/CF)27.80
P/FCF Ratio27.80
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$133.40Price Target Upside8.57% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering6
Genuine Parts Company Business Overview & Revenue Model
Company DescriptionGenuine Parts Company (GPC) is a global distributor of automotive and industrial replacement parts, operating primarily under the NAPA Auto Parts brand in the automotive sector and Motion Industries in the industrial segment. Founded in 1928 and headquartered in Atlanta, Georgia, GPC serves a diverse customer base, including repair shops, service stations, and industrial operations, by providing top-quality parts and supplies. The company maintains an extensive distribution network across North America, Europe, and Australasia, ensuring timely delivery and access to a wide range of products.
How the Company Makes MoneyGenuine Parts Company generates revenue through its extensive distribution network, primarily by selling automotive and industrial replacement parts. The company's key revenue streams are its Automotive Parts Group, which includes NAPA Auto Parts stores and services, and its Industrial Parts Group, represented by Motion Industries. The Automotive Parts Group serves both retail and wholesale customers, while the Industrial Parts Group caters to maintenance, repair, and operations (MRO) needs of industrial facilities. Significant partnerships with automotive and industrial manufacturers enhance GPC's product offerings and market reach, while investments in technology and logistics capabilities improve operational efficiency and customer service, contributing to its earnings.
Genuine Parts Company Financial Statement Overview
Summary
Genuine Parts Company exhibits steady financial performance with consistent revenue growth and strong operational efficiency. However, rising leverage and declining profit margins could pose future risks. The cash flow position shows some weakening, which may limit flexibility. Investors may view the company as stable but should monitor debt levels and profitability closely.Income Statement
Genuine Parts Company shows a solid income statement with consistent revenue growth over the years. The revenue growth rate for the latest year is positive, though slightly slower compared to previous years. The gross profit margin is robust, indicating effective cost control, while the net profit margin has declined, suggesting rising expenses or lower sales efficiencies. EBIT and EBITDA margins remain healthy, showcasing strong operational efficiency.75
Positive
Balance Sheet
The balance sheet reveals a moderate financial position. The debt-to-equity ratio has increased, indicating higher leverage, which could pose risks in downturns. However, the company maintains a reasonable equity ratio, reflecting a solid asset base financed by equity. Return on equity has decreased, which might concern investors about declining profitability on shareholders' investments.70
Positive
Cash Flow
Cash flow analysis highlights a decline in free cash flow over the last year, which could impact future investments or debt repayments. The operating cash flow to net income ratio suggests decent cash generation relative to accounting profits, though it has decreased from previous periods. The free cash flow to net income ratio has also dropped, pointing to tighter cash conditions despite profitability.68
Positive
| Breakdown | |||||
| TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 23.30B | 23.49B | 23.09B | 22.10B | 18.87B | 16.54B | Gross Profit |
| 8.30B | 8.52B | 8.29B | 7.74B | 6.63B | 5.65B | EBIT |
| 1.53B | 1.23B | 1.75B | 1.65B | 1.26B | 1.03B | EBITDA |
| 1.89B | 1.68B | 2.16B | 1.99B | 1.55B | 1.27B | Net Income Common Stockholders |
| 1.09B | 904.08M | 1.32B | 1.18B | 898.79M | 163.40M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 479.99M | 479.99M | 1.10B | 653.46M | 714.70M | 990.17M | Total Assets |
| 19.28B | 19.28B | 17.97B | 16.50B | 14.35B | 13.44B | Total Debt |
| 5.74B | 5.74B | 4.89B | 4.16B | 3.20B | 3.47B | Net Debt |
| 5.26B | 5.26B | 3.78B | 3.51B | 2.48B | 2.48B | Total Liabilities |
| 14.44M | 14.44M | 13.55B | 12.69B | 10.85B | 10.22B | Stockholders Equity |
| 4.34B | 4.34B | 4.40B | 3.79B | 3.49B | 3.20B |
| Cash Flow | Free Cash Flow | ||||
| 900.98M | 683.91M | 922.93M | 1.13B | 992.15M | 1.87B | Operating Cash Flow |
| 1.45B | 1.25B | 1.44B | 1.47B | 1.26B | 2.02B | Investing Cash Flow |
| -1.48B | -1.51B | -705.79M | -1.68B | -506.16M | 171.64M | Financing Cash Flow |
| 431.69M | -333.94M | -292.16M | 205.10M | -989.53M | -1.51B |
Genuine Parts Company Technical Analysis
Neutral
122.87
Price Trends
118.90
Positive
121.55
Positive
129.89
Negative
Market Momentum
1.26
Negative
54.78
Neutral
65.77
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GPC, the sentiment is Neutral. The current price of 122.87 is above the 20-day moving average (MA) of 121.70, above the 50-day MA of 118.90, and below the 200-day MA of 129.89, indicating a neutral trend. The MACD of 1.26 indicates Negative momentum. The RSI at 54.78 is Neutral, neither overbought nor oversold. The STOCH value of 65.77 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for GPC.
Genuine Parts Company Risk Analysis
Genuine Parts Company disclosed 17 risk factors in its most recent earnings report. Genuine Parts Company reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Genuine Parts Company Peers Comparison
Overall Rating
UnderperformOutperform
Sector (60)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $4.02B | 21.35 | 14.69% | ― | 4.11% | 50.07% | |
72 Outperform | $77.71B | 33.37 | -174.09% | ― | 5.67% | 5.40% | |
71 Outperform | $58.30B | 23.21 | -14.95% | ― | 5.19% | 8.31% | |
71 Outperform | $10.91B | 16.09 | 11.38% | 2.86% | 3.53% | -25.71% | |
67 Neutral | $17.05B | 18.98 | 20.84% | 3.23% | 1.71% | -30.78% | |
60 Neutral | $13.01B | 10.45 | 0.79% | 3.53% | 1.60% | -22.47% | |
45 Neutral | $2.07B | 59.62 | -15.47% | 2.82% | -9.34% | -852.37% |
* Consumer Cyclical Sector Average
Performance Comparison
GPC
Genuine Parts Company
122.87
-23.76
-16.20%
AAP
Advance Auto Parts
34.58
-36.68
-51.47%
AZO
AutoZone
3,473.66
370.80
11.95%
DORM
Dorman Products
130.25
39.09
42.88%
LKQ
LKQ
42.08
-8.31
-16.49%
ORLY
O'Reilly Auto
1,356.77
277.10
25.67%
Genuine Parts Company Earnings Call Summary
Earnings Call Date: Feb 18, 2025 | % Change Since: -1.63% | Next Earnings Date: Apr 17, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed picture with notable achievements in employee engagement and strategic acquisitions contributing to sales growth. However, challenges in the industrial and automotive segments, particularly in the U.S. and Europe, as well as a decline in earnings for the fourth quarter, highlighted ongoing market and cost pressures.Highlights
Global Engagement and Workforce Development
A record 81% of teammates reported being highly engaged in the most recent Global Engagement Survey, an increase of three points from previous surveys.
Sales and Strategic Acquisitions
Total sales for 2024 were $23.5 billion, an increase of approximately $400 million or 1.7% compared to 2023, with 260 basis points from strategic acquisitions.
Dividend Increase
The Board approved a 3% increase to the dividend, marking the 69th consecutive year of dividend increases.
Asia Pacific Performance
Sales in Asia Pacific increased 6% in local currency, with comparable sales growth up approximately 4%.
Lowlights
Industrial Segment Decline
Global Industrial sales were $8.7 billion, a decrease of 1.4% compared to last year, with EBITDA down 20 basis points due to sales deleverage and inflationary cost pressures.
U.S. Automotive Segment Challenges
U.S. Automotive sales were up approximately 3% with flat comparable sales growth, facing ongoing pressures from a soft market environment and cost pressures.
Challenges in European Markets
Sales in Europe were up 6% in local currency, with flat comparable sales growth and ongoing execution challenges amid a weak economic backdrop.
Q4 Earnings Decline
Despite revenue growth, earnings were down in the fourth quarter due to headwinds from planned investments and cost inflation.
Company Guidance
During the Genuine Parts Company's fourth quarter 2024 earnings call, management provided detailed guidance for 2025, emphasizing a cautious outlook due to ongoing weak market conditions. The company anticipates total sales growth of 2% to 4% for 2025, with comparable sales growth expected to be flat to up 2% for the automotive segment and 1% to 3% for the industrial segment. Gross margin is projected to expand by 40 to 60 basis points, while SG&A is expected to deleverage by 20 to 40 basis points. The company plans to achieve $100 million to $125 million in cost savings through expanded restructuring efforts, contributing to an overall target of $200 million in annualized cost savings by 2026. Additionally, Genuine Parts Company expects adjusted diluted earnings per share to range from $7.75 to $8.25. The guidance reflects the company's strategic investments, cost management initiatives, and expectations for gradual market improvement in the latter half of the year.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.