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Genuine Parts (GPC) closed at $176.57 in the latest trading session, marking a +0.9% move from the prior day. This change outpaced the S&P 500’s 0.59% gain on the day. Elsewhere, the Dow gained 0.53%, while the tech-heavy Nasdaq added 0.45%.
Prior to today’s trading, shares of the auto and industrial parts distributor had lost 4.86% over the past month. This has was narrower than the Auto-Tires-Trucks sector’s loss of 14.87% and lagged the S&P 500’s loss of 4.33% in that time.
Wall Street will be looking for positivity from Genuine Parts as it approaches its next earnings report date. The company is expected to report EPS of $1.87, up 4.47% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $5.29 billion, up 10.2% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $8.16 per share and revenue of $21.87 billion. These totals would mark changes of +18.09% and +15.87%, respectively, from last year.
Investors should also note any recent changes to analyst estimates for Genuine Parts. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company’s business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.05% lower. Genuine Parts is currently a Zacks Rank #3 (Hold).
Digging into valuation, Genuine Parts currently has a Forward P/E ratio of 21.45. For comparison, its industry has an average Forward P/E of 13.69, which means Genuine Parts is trading at a premium to the group.
Also, we should mention that GPC has a PEG ratio of 1.79. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company’s expected earnings growth rate. Automotive – Replacement Parts stocks are, on average, holding a PEG ratio of 1.42 based on yesterday’s closing prices.
The Automotive – Replacement Parts industry is part of the Auto-Tires-Trucks sector. This group has a Zacks Industry Rank of 209, putting it in the bottom 18% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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