LKQ reported third-quarter adjusted earnings per share of 88 cents, missing the street view of 89 cents. Quarterly sales of $3.584 billion missed the analyst consensus of $3.639 billion.

Parts and services organic revenue decreased by 2.8% (4.3% on a per-day basis), while the net impact of acquisitions and divestitures contributed a 3.1% revenue increase.

Additionally, foreign exchange rates boosted revenue by 0.4% year over year, resulting in a total parts and services revenue increase of 0.6%. Other revenue declined by 2.2%, mainly due to lower commodity prices and volumes compared to the same period in 2023.

On an adjusted basis, net income was $230 million compared to $231 million in the year-ago period, a decrease of 0.3%.

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As of September 30, the balance sheet reflected a total debt of $4.4 billion, and total leverage, as defined in the credit facility, was 2.4x EBITDA.

During the third quarter, the company returned over $200 million to its shareholders by investing approximately $125 million to repurchase 3.0 million shares of its common stock and distributing $79 million in cash dividends.

The company also approved a $1 billion increase to the stock repurchase program, raising the total authorization to $4.5 billion, with an available balance of $1.8 billion for potential repurchases through October 25, 2026.

Additionally, the board declared a quarterly cash dividend of $0.30 per share of common stock, payable on November 27, to stockholders of record as of the close of business on November 14.

LKQ has revised its outlook, now projecting adjusted EPS of $3.38 to $3.52, compared to an estimate of $3.53. The prior range was $3.50 to $3.70.

Additionally, for FY24, LKQ expects an organic revenue decline for parts and services of 2.75% to 1.75%, a shift from the previous forecast of a decline of 1.25% to an increase of 0.25%.

Price Action: LKQ shares are trading lower by 0.13% to $37.73 at last check Thursday.

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