LKQ Corporation (LKQ) AI Stock Analysis

LKQ Corporation distributes replacement parts, components, and systems used in vehicle repair and maintenance. Operating through North America, Europe, and Specialty segments, the company provides bumper covers, body panels, automotive glass, engines, transmissions, and mechanical and collision parts to repair shops, dealerships, and retail consumers. LKQ also distributes aftermarket accessories such as towing hitches, truck bed covers, vehicle protection items, suspension components, recreational vehicle appliances, air conditioners, wheels, tires, automotive fluids, and electrical products. Founded in 1998 and based in Chicago, Illinois, the company employs 44,000 people and maintains operations across the United States, Canada, several European countries, and Taiwan.

LKQ achieved a 5-year revenue compound annual growth rate of 3.7% from FY2020 to FY2025. Annual revenue expanded from $13.09B in FY2021 to a peak of $14.36B in FY2024 before decreasing 3.1% to $13.92B in FY2025. Gross margin contracted from 40.7% in FY2021 to 38.0% in FY2025, while operating margin fell from 11.3% to 7.8%. Net income declined from $1.09B in FY2021 to $607.0M in FY2025, reducing diluted EPS from $3.96 to $3.09. For the latest quarter ended June 30, 2026, quarterly revenue fell 3.0% year-over-year, and quarterly earnings decreased 29.0% year-over-year, bringing trailing twelve months net margin to 3.4%.

As of June 30, 2026, LKQ held $301.0M in cash and short-term investments against $5.31B in total debt, resulting in net debt of $5.01B. Total assets were $15.03B and shareholders' equity was $6.45B, representing a debt-to-equity ratio of 0.82 and a current ratio of 1.58. During FY2025, operating cash flow was $1.06B and free cash flow reached $847.0M. The company directed capital toward $216.0M in capital expenditures, $310.0M in dividend payments, and $159.0M in share buybacks, which helped reduce 5-year share count by 12.5%.

LKQ trades at a trailing P/E of 12.5x and a forward P/E of 7.9x, both below the median of its US-listed Consumer Cyclical peers at 18.0x and 14.1x, respectively. Its enterprise value to EBITDA ratio is 8.4x compared to the peer median of 11.1x, and its price-to-sales multiple is 0.4x against the peer group median of 0.7x. The stock has underperformed broader equities, declining 22.2% over the past year and 53.7% over five years, while the S&P 500 benchmark gained 16.8% and 83.0% over those respective horizons.

LKQ pays a quarterly dividend with an annual forward payout of $1.20 per share, delivering a dividend yield of 5.40%. The company has paid consecutive dividends for 6 years and maintains a payout ratio of 43.3%. Its most recent ex-dividend date occurred on August 20, 2026, following FY2025 total dividend distributions of $310.0M.

Wall Street coverage includes 4 Strong Buy, 3 Buy, and 2 Hold recommendations, with zero Sell ratings. The mean price target of $32.12 represents 44.5% potential upside from the last closing price of $22.23. For the fiscal year ending December 31, 2026, consensus estimates project EPS of $2.67 on revenue of $13.59B. Over the last four quarters, LKQ exceeded earnings estimates 1 time, with next earnings scheduled for October 29, 2026.

This page is an AI-written research summary of LKQ Corporation (LKQ). The text was generated on October 30, 2026 from Quotelinks data as of October 16, 2026 (company profile, annual results, latest balance sheet, valuation, price performance and analyst estimates). An automatic check rejects any draft that contains a figure not found in that data. It is not investment advice; verify figures on the linked tabs before making decisions.

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