LKQ Corp

LKQ: XNAS (USA)

Morningstar Rating for Stocks	Fair Value	Economic Moat	Capital Allocation
	$75.00	Xccth	Rvhtnnbw

LKQ: Impressive Distribution Scale Should Prompt a Favorable Organic Growth Trajectory

Noah Rohr

Aug 23, 2024

We raised our fair value estimate on narrow-moat LKQ by 3% to $53 due to a slight uptick in our midcycle operating margin forecast to 10.4% (versus 10% previously). We currently view shares as undervalued as near-term demand pressures have weighed on the firm’s results in recent quarters. Still, we think LKQ enjoys a strong position in the highly fragmented auto parts distribution industry, buoying its long-term prospects.

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