LKQ

LKQ CorporationConsumer Cyclical / Auto PartsINTACT

LKQ Corporation engages in the distribution of replacement parts, components, and systems used in the repair and maintenance of vehicles and specialty vehicle aftermarket products and accessories. The company operates through four segments: Wholesale-North America, Europe, Specialty, and Self Service. It offers bumper covers, automotive body panels, and lights, as well as paint and paint related consumables for refinishing vehicles; mechanical automotive parts and accessories; salvage products, including mechanical and collision parts comprising engines; transmissions; door assemblies; sheet metal products, such as trunk lids, fenders, and hoods; and lights and bumper assemblies. The company also provides scrap metal and other materials to metals recyclers; precious metals, such as catalytic converters; and brake pads, discs and sensors, clutches, steering and suspension products, filters, and oil and automotive fluids, as well as electrical products, including spark plugs and batteries. In addition, the company distributes recreational vehicle appliances and air conditioners, towing hitches, truck bed covers, vehicle protection products, marine electronics, cargo management products, wheels, tires, and suspension products. It serves collision and mechanical repair shops, new and used car dealerships, and retail customers. The company operates in the United States, Canada, Germany, the United Kingdom, Belgium, the Netherlands, Luxembourg, Italy, the Czech Republic, Austria, Poland, Slovakia, France, and other European countries. LKQ Corporation was incorporated in 1998 and is headquartered in Antioch, Tennessee.

Share Price
$24.11
52W: $21.17 - $37.13
DCF Fair Value
$34.56
+30.2% MoS
P/E (TTM)
13.4x
ROIC
8%
Operating Margin
7%
FCF Yield
11.9%
Debt / Equity
0.82x
Piotroski Score
8/9
Altman Z-Score
4.74
Market Cap
$6.1B

Price vs. Intrinsic Value Corridor

Margin of Safety Buy Zone (<25% Discount)

Historical market price overlaid against conservative DCF Fair Value & Benjamin Graham Margin of Safety bands.

Period Return (1Y)
()
Period Range
$ - $
DCF Fair Value
$34.56
MOS Buy Target (-25%)
$25.92
Valuation Overlays:

2-Stage Discounted Cash Flow (DCF) Workbench

Conservative intrinsic value model based on owner cash generation over a 10-year investment horizon. Opens with LocalAlpha's baseline assumptions (matching the fair value shown above) — adjust any input to stress-test.

Current Market Price
$24.11
DCF Fair Value
$34.53
+30.2% MoS
$724M
$100M$724M (Reported)$50,000M
5.3%
-5%10% (Target)35%
4.5%
0%5%20%
9.0%
6%9% (Standard)15% (High Risk)
2.5%
1% (GDP Floor)2.5% (Inflation)4.0%
$5,000M
-$100B CashBalance Sheet+$150B Debt
10-Yr PV of Cash Flows
$6.0B
PV of Terminal Value
$7.8B
Implied Enterprise Value
$13.7B
Implied Equity Value
$8.7B
YearYr 1Yr 2Yr 3Yr 4Yr 5Yr 6Yr 7Yr 8Yr 9Yr 10
Projected FCF ($M)$762$803$845$890$937$979$1,024$1,070$1,118$1,168
Present Value (PV)$699$676$653$631$609$584$560$537$515$493

Benjamin Graham & Buffett Value Models

Classical deep value metrics based on asset backing, normalized earnings power, and owner cash yield.

Graham Number+24.9% MoS
$32.10

Calculated as √(22.5 × EPS × BVPS). The maximum theoretical price a defensive investor should pay based purely on asset book value and current earnings.

EPS: $1.80BVPS: $25.44
Revised Graham Formula+11.5%
$27.23

Formula: V = (EPS × (8.5 + 2g) × 4.4) / Y where g is the conservative 7-10 yr growth rate and Y is AAA Bond Yield.

Buffett Owner Earnings11.3% Yield
$2.72 / share

True distributable cash flow: Net Income + D&A - Maintenance CapEx. Reflects the cash Buffett would extract without hurting unit volume.

Total: $0.7BYield: 11.3%

Reverse DCF: Market Growth Expectation

EXTREMELY LOW BARRIER
-6.0% CAGR (Next 10 Yrs)

At the current price of $24.11, the market is assuming the business will compound Free Cash Flow at -6.0% per year for the next decade with a 9% hurdle rate.

Value Investor Verdict
✓ Low market hurdle: Easy for a wide-moat compounder to beat.
Autonomous Thesis Underwriting

Surveil LKQ with Mathematical Margin of Safety Rules

Set non-negotiable floor rules for LKQ Corporation. If a newly filed quarterly 10-Q breaks your ROIC floor, operating margin boundary, or balance sheet leverage rules, receive an autonomous breach audit within 15 minutes.

Buffett Quality

ROIC > 15% • Margin > 15% • D/E < 0.5x

Margin Floor Guard

Current Margin 7% • Floor > 10%

Solvency Guard

Altman-Z > 2.6 • Current Ratio > 1.5x

Frequently Asked Questions: LKQ Corporation (LKQ) Intrinsic Valuation

Audited fundamentals, DCF intrinsic value sensitivity, and thesis break detection parameters for LKQ Corporation.

Based on institutional multi-stage Discounted Cash Flow (DCF) modeling on audited SEC cash flows, LKQ Corporation has an estimated DCF intrinsic fair value of $34.56 per share compared to its current market price of $24.11. This represents an estimated 30.2% margin of safety (trading below fair value). Additionally, its classic Benjamin Graham Number stands at $32.10.

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