On Feb 26, we issued an updated research report on Genuine Parts Company GPC.
The company announced fourth-quarter 2017 and full-year earnings results on Feb 20. Its adjusted earnings per share came in at $1.12, beating the Zacks Consensus Estimate of $1.11. Quarterly net sales rose 11.3% to $4.21 billion. The top line also surpassed the Zacks Consensus Estimate of $4.09 billion.
In fourth-quarter 2017, AAG’s acquisition, which closed on Nov 2, 2017, contributed 6.8% to sales. Further, Genuine Parts’ total sales figure included a contribution of 8.5% from acquisitions. Furthermore, the company expects to witness an increased contribution from AAG in 2018. This will also assist Genuine Parts to strengthen its footprint on the continent.
Genuine Parts Company Price and Consensus
On the back of lower income taxes and a considerable contribution from the operations of Europe’s Alliance Automotive Group (AAG), Genuine Parts revenues are anticipated to grow 12-13% in 2018. Also, adjusted earnings per share are expected in the range of $5.6-$5.75 compared with $4.18 in 2017.
Earnings estimates for Genuine Parts have been going up lately. The Zacks Consensus Estimate for quarterly earnings has been revised 8.2% upward in the last seven days.
In 2017, Genuine Parts spent a total of $569 million through share repurchase programs and dividend payouts. For fourth-quarter 2017, the company’s board approved a 7% sequential increase in its quarterly cash dividend on common stock to 72 cents per share.
Price Performance
In the last six months, shares of Genuine Parts have outperformed the industry it belongs to. The company’s stock has rallied 14.3% in comparison to the industry’s gain of 7.7%.
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Zacks Rank & Other Key Picks
Genuine Parts carries a Zacks Rank #2 (Buy). A few other top-ranked stocks in the auto space are Standard Motor Products, Inc. SMP, Volkswagen AG VLKAY and AB Volvo VLVLY, each carrying a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Standard Motor has an expected long-term growth rate of 6%. Shares of the company have gained 11.3% in the last six months.
Volkswagen has an expected long-term growth rate of 18.7%. In the last six months, shares of the company have surged 32.8%.
AB Volvo has an expected long-term growth rate of 6.6%. In the last six months, shares of the company have rallied 14.3%.
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