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Genuine Parts (GPC) Beats on Q2 Earnings, Raises '21 View

·3 min read

Genuine Parts Company GPC reported second-quarter adjusted earnings of $1.74 per share, up 31.8% year over year. The bottom line also surpassed the Zacks Consensus Estimate of $1.58 per share. Higher-than-expected revenues and profits across both Automotive and Industrial Parts segments resulted in this outperformance.

This Atlanta-based automotive replacement parts supplier reported net sales of $4,783.7 million, topping the Zacks Consensus Estimate of $4,388 million. The top-line figure was also higher than the year-ago quarter’s $3,823.2 million. This upside resulted from 19.5% growth in comparable sales, 4.1% forex gains and a 1.5% benefit from acquisitions.

Genuine Parts Company Price, Consensus and EPS Surprise

Genuine Parts Company Price, Consensus and EPS Surprise
Genuine Parts Company Price, Consensus and EPS Surprise

Genuine Parts Company price-consensus-eps-surprise-chart | Genuine Parts Company Quote

Segmental Performance

The Automotive segment’s net sales — accounting for 67% of the firm’s total revenues — totaled $3,196.3 million for the reported quarter, up 28.1% year over year on the back of comps growth, favorable forex translations and acquisition benefits. The metric also surpassed the Zacks Consensus Estimate of $2,895 million. The segment’s comparable sales rose 21.1% year over year for the second quarter. Operating profit increased 32.8% year over year to $290.8 million and topped the consensus mark of $263 million.

The Industrial Parts segment’s net sales grew 19.6% from the year-ago quarter to $1,587.4 million on the back of comps growth, forex gains and buyout synergies. Revenues from the segment also beat the consensus estimate of $1,500 million. The segment’s comparable sales rose 16.4% for the reported quarter. Operating profit rose 38.1% from the prior-year quarter to $150.4 million and surpassed the consensus mark of $125 million.

Financial Tidbits

Genuine Parts — which shares space with LKQ Corporation LKQ, Dorman Products DORM and SPX Corporation SPXC in the same industry — had cash and cash equivalents worth $987.4 million as of Jun 30, 2021. Long-term debt decreased to $2,472.9 million from $2,727.9 million recorded in the year-ago period. Free cash flow for the quarter under review totaled $361.8 million.

Guidance Raised

Genuine Parts — which presently carries a Zacks Rank #2 (Buy) — raised its 2021 guidance. The company now projects revenues from automotive and industrial sales to witness a year-over-year uptick of 11-13% and 6-8%, up from the prior guided range of 5-7% and 4-6%, respectively. Full-year adjusted earnings per share are envisioned in the band of $6.20-$6.35, suggesting a 5.4% increase from the mid-point of the prior forecast. Operating cash flow and free cash flow are projected in the band of $1.2-$1.4 billion and $900 million to $1.1 billion, up from the previous forecast of $1-$1.2 billion and $700-$900 million, respectively. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.


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