Investors Cautiously Shuffling Back into LKQ Corporation (LKQ) Shares

On December 03, 2019, LKQ Corporation (NASDAQ:LKQ) shares lost -2.55% or -0.9 points to close at $34.42 with a thin trading volume of 3.534 million shares. It opened the trading session at $34.97, the shares rose to $35.155 and dropped to $34.15, the range by which the price of stock traded the whole day. The company now has a market cap of $10.7 billion and currently has 309.76 million outstanding shares. LKQ Corporation (LKQ) stock has plunged -2.05 percent of market value in 21 trading days.

LKQ stock’s trailing 3-year beta is 1.33, meaning there will be a greater rate of return, although posing a higher risk. The part of a firm’s profit given to each outstanding share of regular stock was $1.41 share in the trailing 52 weeks. The stock’s value surged 45.05 percent year to date (YTD) compared to a rise of 23.64 percent in 52 week’s period. The firm’s shares are still trading -4.94 percent below its 1-year high of $36.21 and 51.36 percent up from 52-week low of $22.74. The average consensus ranking on the company is 1.6, on a ranging where 5 is equal to a consensus sell rating. In other words, the mean analyst recommendations are ranking this stock as a buy.

LKQ Corporation (LKQ) is most likely going to rise 16.33 percent in the coming 12 months, as per price target approximations compiled by finviz. Nevertheless, they have set the price target at a $44-month high price target. This represents a whopping 27.83 percent increase from the current trading of shares. The 52-week median price target given by the analysts is $40, which means a return possibility of 16.21 percent in comparison with the closing price of the stock of $34.42 on December 03. The lowest price set for the stock is $29 — just above -15.75 percent from LKQ share price now.

Past records have indicated that shares in LKQ Corporation rose on 21 different earnings reaction days and we have yet to see whether this trend will play out and remain in place when the company reports upcoming earnings. Investors will get the next hint of LKQ’s Q4 earnings on February 27. Analysts are predicting revenue to climb 0.6 percent to $3.02B in the financial fourth quarter, while EPS will soar by about 8.33 percent to $0.52 per share. In the last quarter, it earnings of $0.61 per share came better than the $0.55812, adjusted, expected by Thomson Reuters consensus estimate. Revenue for the quarter was $3B, missing the $3.02B analysts had expected. Earnings are seen to rise by 1.9 percent this year, 9.95 percent in the coming year and the trend continues by 33.5 percent every year in the next 5 years.

Let’s take a glimpse at some insider activity at LKQ Corporation (NASDAQ:LKQ) and observe the pattern. The earliest insider trade happened on 11/27/2019. Clark Michael S. parted with a total of 3.81 thousand shares of the firm at average share price of $35.63. The total amount for the sale was set at $135.89 thousand. On completing this exchange, the VP of Finance and Controller account balance was 73.01 thousand shares. The stock lost -3.4 percent from that insider sale. On 11/05/2019, MCGARVIE BLYTHE J, Director, did a sale of 13.69 thousand shares at a price of $35.62 per share. This got rid of 487.71 thousand shares from the insider’s fortune and the stock experienced a -3.37 percent retreat in price since the news became public. This exchange saw 20.99 thousand shares get out from the Director account.

On 07/15/2019, EVP and Managing Dir., Europe Quinn John S recorded a sale transaction valued at $289.9 thousand. The sale at $27.04 a share has eliminated 10.72 thousand shares from the insider’s portfolio position. Meanwhile, shares price witnessed 27.29 percent increase since the transaction reporting date. The company insider is left with 254.67 thousand shares remaining in the account. HOLSTEN JOSEPH M, who works as Director at the company, performed a sale of 2 thousand shares in a transaction worth $55.92 thousand. The disposal recorded on 05/08/2019 was priced at $27.93 per share. The stock price soared 23.24 percent since the transaction. HOLSTEN JOSEPH M currently holds a stake of 266.72 thousand in LKQ stock which is worth $9.18 million after the insider selling.

The stock is lingering around the initial support level of $33.99. After this, the following support is at the zone of $33.57. Up until the time the LKQ stock hit levels beyond the current one, bulls should have no alarm. In terms of its momentum, the stock’s RSI hit 49.55 on the daily chart, and this may be a cause for concern. In case the price goes below $33.57 level on closing basis, there may be more profit booking with the stock growing weaker. Still, getting to the $35 level may cause a pull-back move approaching $35.58 mark.

LKQ Corporation (LKQ) shares are trading at a P/E ratio of 24.2 times earnings posted in the trailing 12 months. The industry LKQ deals with has an average P/E of 18.6. Its P/B ratio is standing at 2.2X compared to the 2.3 industry average. It is additionally sporting a 0.9 on the Price-to-Sales ratio, compared to the industry’s P/S average of 0.6. LKQ Corporation has a 38.5% gross profit margin, with its operating margin around 6.8%. Alongside this, the company’s net profit margin currently stands at 3.5%.