Core Viewpoint - Genuine Parts Company (GPC) has announced a 3% increase in its quarterly cash dividend for 2025, marking the 69th consecutive year of dividend increases, reflecting its financial strength and reliability [1][2] Financial Performance - GPC's shares have decreased by 15.5% over the trailing 12 months, underperforming the Zacks Auto, Tires and Trucks sector's growth of 12.4% and the S&P 500 Index's return of 24% [2][3] - The company's forward 12-month price/earnings ratio is 14.67X, significantly lower than the sector's average of 23.83X, indicating that GPC shares are currently undervalued [7] Market Conditions - GPC is facing weak market conditions, particularly in the global automotive market, which is affecting profitability due to cost pressures and sluggish demand in key regions like Europe and the United States [13][14] - Macroeconomic challenges such as high interest rates and cost inflation are further complicating the company's operational landscape [14] Competitive Landscape - GPC is experiencing intense competition in the automotive and industrial parts sectors, which may necessitate price reductions in response to competitors' actions, potentially impacting revenues and earnings [15] Strategic Initiatives - In 2024, GPC acquired over 100 companies, enhancing its capabilities and geographic coverage, and executed four bolt-on acquisitions to strengthen value-added solutions [10] - The company is investing in technology, including AI and automation, to improve operational efficiency and inventory management [11] - GPC's global restructuring efforts are expected to yield $200 million in annualized savings by 2026 [12] Earnings Outlook - GPC anticipates total sales growth of 2% to 4% for 2025, with EPS expected between $7.75 and $8.25, and free cash flow projected at $800 million to $1 billion [16] - The consensus estimate for GPC's 2025 EPS has decreased by 1.2% over the past 30 days, currently pegged at $8.20 [17] Investment Considerations - While GPC's strategic acquisitions and technological advancements support long-term prospects, the current weak market conditions and intense competition suggest a cautious approach for investors [18]

Core Viewpoint - The market is currently awaiting a genuine sales growth inflection for Genuine Parts Company (GPC), but there are still further opportunities for its equity story following the release of its Q4 results [1]. Group 1 - Genuine Parts Company has recently reported its Q4 results, which include several positive takeaways that investors should consider [1].

Group 1 - Genuine Parts Company (GPC) reported its Q4 results on February 18, indicating a weakened performance due to poor industry conditions [1] - The company also provided guidance for 2025, suggesting a cautious outlook amid the current market challenges [1] Group 2 - The automotive replacement parts retail and distribution sector is facing weak industry conditions, impacting the performance of companies like GPC [1]

Core Viewpoint - Genuine Parts reported better-than-expected sales and earnings, yet shares fell due to concerns over future guidance and profit margins [1][2]. Group 1: Earnings Performance - Genuine Parts earned $1.61 per share, surpassing analyst expectations of $1.55, with sales approaching $5.8 billion, exceeding the forecast of $5.7 billion [1][2]. - Quarterly sales increased by only 3.3% year over year, and gross profit margins decreased by 50 basis points to 35.9% due to an inventory write-down [2]. - For the full year, sales grew 1.7% to $23.5 billion, while earnings declined by 31% to $6.47 per share [3]. Group 2: Future Guidance - Management projected sales growth of only 2% to 4% for the upcoming year, with adjusted EPS expected to range from $7.75 to $8.25, below analysts' forecast of $8.29 [4]. - GAAP profits are anticipated to be lower, estimated between $6.95 to $7.45 per share [4]. - A significant charge related to the U.S. pension plan termination is expected to impact diluted EPS, although it is not included in the 2025 forecast [5].

Financial Data and Key Metrics Changes - Total GPC sales for 2024 were $23.5 billion, an increase of approximately $400 million or 1.7% compared to 2023, with a benefit of 260 basis points from strategic acquisitions [13] - Adjusted gross margin increased by 70 basis points, driven by acquisitions and strategic pricing initiatives [13] - Operating cash flow was $1.3 billion, with over $700 million returned to shareholders through dividends and share repurchases [14] - Fourth quarter total GPC sales increased by 3.3%, including a benefit from acquisitions of 320 basis points [58] Business Segment Data and Key Metrics Changes - Global Industrial segment sales were $8.7 billion, a decrease of 1.4% compared to last year, with comparable sales down 2% [15] - Global Automotive segment sales were $14.8 billion, an increase of approximately 4% compared to last year, with a benefit of 370 basis points from acquisitions [27] - Global Industrial segment EBITDA was $1.1 billion, which was 12.6% of sales, a decrease of 20 basis points versus the prior year [17] - Global Automotive segment EBITDA was $1.3 billion, which was 8.7% of sales, a decrease of 70 basis points versus 2023 [29] Market Data and Key Metrics Changes - In the U.S., total automotive sales were up approximately 3% in 2024, with roughly flat comparable sales growth [29] - European sales increased 6% in local currency, with flat comparable sales growth [38] - Asia Pacific sales increased 6% in local currency, with comparable sales growth up approximately 4% [40] - Canadian sales increased approximately 1% in local currency, with comparable sales down approximately 2% [42] Company Strategy and Development Direction - The company is focused on strategic investments in technology, talent, sales, and supply chain to enhance customer experience and drive profitable growth [11] - Over 100 acquisitions were made in 2024 to enhance capabilities and geographic coverage [12] - The company aims to balance long-term strategic investments with urgent cost actions in response to current market conditions [51] - M&A will continue to play an important role in growth, particularly in automotive and industrial segments [45] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism about gradual improvement in market conditions for both industrial and automotive segments in 2025 [50] - The company anticipates soft market conditions to persist into the first half of 2025, with expectations for improvement in the second half [50] - Management highlighted the importance of operational excellence and customer service in navigating challenging market conditions [53] Other Important Information - The company executed a global restructuring that led to $45 million in cost savings in 2024, with additional savings expected in 2025 [14][52] - The Board approved a 3% increase in dividends, marking the 69th consecutive year of dividend increases [14] - The company is targeting an additional $100 million to $125 million in savings for 2025 [52] Q&A Session Summary Question: Reconciliation of operational improvements and underperformance - Management acknowledged the operational improvements but noted that the company is not satisfied and is focused on continuing progress [90][94] Question: Guidance on sales progression and impact of weather - Management indicated that weak conditions are expected to persist in the first half of 2025, with expectations for improvement in the second half [102][103] Question: Impact of tariffs on business - Management described the situation as fluid, with a diversified global supply chain in place to manage tariff exposure effectively [112][113] Question: Sales growth expectations - Management confirmed that sales growth is expected to be in the range of 2% to 4% for 2025, with a focus on sequential improvement throughout the year [80][119]

Genuine Parts Company (GPC) reported fourth-quarter 2024 adjusted earnings of $1.61 per share, which beat the Zacks Consensus Estimate of $1.54. The bottom line declined from year-ago earnings of $2.26 per share. See the Zacks Earnings Calendar to stay ahead of market-making news.The company reported net sales of $5.8 billion, which surpassed the Zacks Consensus Estimate of $5.69 billion and inched up 3.3% year over year. This increase was due to a 3.2% boost from acquisitions and a 0.6% impact from favorab ...

Genuine Parts (GPC) reported $5.77 billion in revenue for the quarter ended December 2024, representing a year-over-year increase of 3.3%. EPS of $1.61 for the same period compares to $2.26 a year ago.The reported revenue compares to the Zacks Consensus Estimate of $5.69 billion, representing a surprise of +1.34%. The company delivered an EPS surprise of +4.55%, with the consensus EPS estimate being $1.54.While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and ...

Genuine Parts (GPC) came out with quarterly earnings of $1.61 per share, beating the Zacks Consensus Estimate of $1.54 per share. This compares to earnings of $2.26 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 4.55%. A quarter ago, it was expected that this auto and industrial parts distributor would post earnings of $2.44 per share when it actually produced earnings of $1.88, delivering a surprise of -22.95%.Over the last ...

Sales Performance - Fourth quarter 2024 sales reached $5.8 billion, a 3.3% increase from $5.6 billion in the same period last year[4]. - Full-year 2024 sales totaled $23.5 billion, up 1.7% compared to 2023[12]. - Global Automotive sales were $3.7 billion, up 6.1% from the same period in 2023[10]. - Industrial sales were $2.1 billion, down 1.2% from the same period in 2023[11]. - Total net sales for the year ended December 31, 2024, increased by 1.7%, with automotive sales growing by 3.7% and industrial sales declining by 1.4%[47]. Earnings and Profitability - Adjusted diluted EPS for 2024 was $8.16, a decrease of 12.5% from $9.33 per diluted share in 2023[13]. - Net income for Q4 2024 decreased to $133,056, down 58.0% from $316,875 in Q4 2023[32]. - Basic earnings per share for Q4 2024 were $0.96, compared to $2.27 in Q4 2023, representing a decline of 57.6%[32]. - Net income for the year ended December 31, 2024, was $904,076, a decrease of 31.3% from $1,316,524 in 2023[42]. - Adjusted net income for the year ended December 31, 2024, was $1,139,841, compared to $1,316,524 in 2023, reflecting a decrease of 13.4%[44]. - Corporate EBITDA for Q4 2024 was $(121,911), compared to $(63,964) in Q4 2023, indicating increased costs associated with corporate operations[35]. Cash Flow and Assets - The company generated cash flow from operations of $1.3 billion and free cash flow of $684 million for the year[14]. - Net cash provided by operating activities decreased to $1,251,251 from $1,435,610, reflecting a decline of 12.8%[42]. - Free cash flow for the year ended December 31, 2024, was $683,912, down 26.0% from $922,935 in 2023[48]. - Total current assets increased to $9,852,584 in 2024 from $9,605,852 in 2023, primarily driven by a rise in merchandise inventories[40]. - Total assets grew to $19,282,705 in 2024, up from $17,968,454 in 2023, indicating a 7.3% increase[40]. - The company reported a net decrease in cash and cash equivalents of $622,016, compared to an increase of $448,544 in 2023[42]. Dividends and Shareholder Returns - A 3% increase in the quarterly cash dividend was declared, raising the annual rate to $4.12 per share[16]. - The company declared dividends of $1.00 per common share in Q4 2024, up from $0.95 in Q4 2023[32]. Future Outlook - The company expects total sales growth of 2% to 4% for 2025[21]. - Adjusted diluted EPS guidance for 2025 is set at $7.75 to $8.25[21]. - The company anticipates additional restructuring costs of approximately $150 million to $180 million in 2025, with expected savings of $100 million to $125 million[17]. Restructuring and Costs - The company reported restructuring costs of $59,695 in Q4 2024, compared to no such costs in Q4 2023[36]. - The company incurred restructuring and other costs of $221,007 for the year, impacting overall profitability[44]. Debt and Acquisitions - The company’s long-term debt increased to $3,742,640 in 2024 from $3,550,930 in 2023, reflecting a rise of 5.4%[40]. - The company made acquisitions totaling $1,080,238 in 2024, significantly higher than $306,881 in 2023[42]. Tax and Other Financials - Cash paid for income taxes in 2024 was $264,625, down from $366,270 in 2023[42]. - GAAP diluted net income per common share for the year ended December 31, 2024, was $6.47, down from $9.33 in 2023[44].

Declares Dividend Increase for 69th Consecutive YearProvides 2025 OutlookFourth Quarter 2024 Highlights Sales of $5.8 billion Diluted EPS of $0.96 Adjusted Diluted EPS of $1.61Full-Year 2024 Highlights Sales of $23.5 billion Diluted EPS of $6.47 Adjusted Diluted EPS of $8.16 Cash from Operations of $1.3 billion; Free Cash Flow of $684 million Returned $705 million to Shareholders via Cash Dividends and Share Repurchases2025 Outlook Revenue Growth of 2% to 4% Adjusted Diluted EPS of $7.75 to $8.25 Dividend I ...