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Genuine Parts (GPC) Q4 Earnings Surpass Estimates, Up Y/Y

Zacks Equity Research

Genuine Parts Company GPC has reported adjusted earnings of $1.35 per share in fourth-quarter 2018, up 13% year over year. The bottom line surpassed the Zacks Consensus Estimate of $1.33. During the reported quarter, each business segments witnessed revenue growth.

The company recorded net income of $186.7 million in fourth-quarter 2018, up from $108.2 million in the prior-year quarter.

Genuine Parts reported net sales of $4.6 billion, up 9% year over year. The figure was almost in line with the Zacks Consensus Estimate. Total sales included 4.6% comparable growth, 6% from acquisitions and 1.2% adverse impact of the foreign currency translation.

Operating profit increased to $356 million from $313.3 million in fourth-quarter 2017. Selling, administrative and other expenses rose to $1.21 billion from $1 billion a year ago.

2018 Results

For 2018, adjusted earnings per share were $5.68, up from the 2017 figure of $4.71.

For the year, revenues were $18.7 billion, up from the 2017 figure of $16.3 billion.

Genuine Parts Company Price, Consensus and EPS Surprise

 

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

 

Segmental Results

The Automotive segment’s net sales improved to $2.58 billion from the year-ago figure of $2.1 billion. Moreover, the segment’s operating profit rose to $199.3 million in the reported quarter from $183.2 million a year ago.

The Industrial Parts segment’s net sales rose to $1.57 billion from $1.45 billion in the year-ago quarter. Moreover, operating profit increased to $130.8 million from $116.5 million in the year-ago quarter.

The Business Products segment’s net sales rose to $456.8 million from $449.8 million recorded in the prior-year quarter. Operating profit for the segment increased to $25.9 million from $13.7 million recorded in the prior-year quarter.

Financial Position

Genuine Parts had cash and cash equivalents of $333.5 million as of Dec 31, 2018, up from $314.9 million as of Dec 31, 2017. As of Dec 31, 2018, long-term debt decreased to $2.4 billion from $2.6 billion as of Dec 31, 2017.

Guidance

For 2019, Genuine Parts expects adjusted earnings per share of $5.81-$5.96.

Zacks Rank & Stocks to Consider

Genuine Parts currently carries a Zacks Rank #3 (Hold). A few better-ranked stocks in the auto space are Oshkosh Corp. OSK, General Motors Company GM and AB Volvo VLVLY. While Oshkosh currently sports a Zacks Rank #1 (Strong Buy), General Motors and Volvo carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Oshkosh has an expected long-term growth rate of 11.3%. Over the past three months, shares of the company have surged 20.6%.

General Motors has an expected long-term growth rate of 8.5%. Over the past three months, shares of the company have risen 11.4%.

Volvo has an expected long-term growth rate of 5%. Over the past three months, shares of the company have risen 8.4%.

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