LKQ Nasdaq Russell 1000 Earnings call
LKQ Corporation (LKQ) · Q2 2026 results and valuation
Share price: $19.99 · 2026-11-11
Results Q2 2026 vs Q1 2026 · previous quarter · published 30 Jul 2026 and 30 Apr 2026
Net income up 72.2% on the previous quarter. Management sounded restrained, in its script and in answers to analysts.
Only a basic analysis is available for this company at the moment.
1 · Numbers
+72.2%
Net income vs Q1 2026
Outlook given
Net income 136.0M vs 79.0M
Revenue −1.8%
Against the same quarter last year (Q2 2025) it is −29.5%, so the move on last quarter looks seasonal or timing-related rather than a trend.
2 · How management spoke
Restrained
Less upbeat than 68% of company calls
Answers to analysts: cautious, in line with the script.
Similar to last call.
3 · What stood out
Figure
Operational processes normalized and system performance improved as the company finished the week above 85% of its normal performance level.
Valuation
Is LKQ Corporation undervalued?
Reverse DCF. Free cash flow from the last full fiscal year (2025-12-31), grown for 10 years, discounted back, plus a terminal value. “Implied growth” is the rate the current price assumes.
At 2.2% growth a year (3-year revenue growth), the model's fair value is $39.65 a share — the stock trades 50% below it. Today's price assumes −6.0% growth a year.
Current price
$19.99
close of 2026-11-11
Market implies growth of iThe yearly free-cash-flow growth, for the next 10 years, that today’s share price already assumes. If you believe the company grows faster than this, the stock is cheap under this model; slower, and it is expensive.
-6.0% for 10 yrs
Fair value / share
$39.65
Buy below
$29.73
Price vs fair value
Undervalued 50%
Price vs buy-below price
Undervalued 33%
Read between the lines
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Key theme
European margins should improve as productivity rises, technology is simplified, and customer service gets better.
Source quote
“In Europe, our reported results were affected by ERP implementation challenges in Germany and softer performance in certain European markets. Specialty also continued to deliver organic growth, demonstrating the resilience of its market position. We take accountability for those results.”
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Guidance
Organic parts and services revenue is now expected to fall between 1% and 3%.
Source quote
“Based on these assumptions, we expect organic parts and services revenue in the range of negative 1% to negative 3%.”
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Fading
European results suffered from ERP rollout problems in Germany and weaker select markets, while the specialty segment kept growing.
Source quote
“On free cash flow, the quarter tracked close to our expectations and reflected normal seasonality. On an adjusted basis, diluted EPS was $0.67 compared to $0.74 in the prior year. As we have observed historically, first quarter working capital is a headwind with receivables increasing from year-end as volumes built through each month of the quarter.”
Tone
How upbeat the language was, compared with other companiesiTone counts positive minus negative finance words, adjusted for length. Executives mostly speak positively, so the labels compare each call with every company's latest call: “typical” is the middle third, “very upbeat” the top tenth, “cautious” the bottom tenth.. Dot: Q2 2026. Ring: Q1 2026.
Script and answers carried a similar tone, so the script's message held up under questioning.
Sentences that drove the tone
“Salvage gross margin exceeded our expectations through improved procurement and operations, there was sequential improvement in fill rates and North America exceeded our free cash flow expectations.”
“For the first 6 months of the year, operating cash flow was $55 million and free cash flow was negative $36 million, which was slightly below our expectations due primarily...”
“Operationally, we continue to see opportunities to improve gross margin, enhance operating efficiency and better leverage our existing cost structure.”
Full figures
USD · SEC EDGAR XBRL (10-Q, period end 2026-06-30)
| Metric | Q2 2026period end 2026-06-30 | Q1 2026period end 2026-03-31 | Change | Q2 2025 | YoY |
|---|---|---|---|---|---|
| Revenue | 3.41B | 3.47B | −1.8% | 3.51B | −3.0% |
| Gross profit | 1.32B | 1.33B | −0.8% | 1.36B | −2.6% |
| Operating income | 225.0M | 217.0M | +3.7% | 299.0M | −24.7% |
| Net income | 136.0M | 79.0M | +72.2% | 193.0M | −29.5% |
| EPS | 0.53 | — | 0.75 | −29.3% | |
| P/E today 12.5 | 14.7 | — | — | 13.6 | +1.1 |
Topics
Most discussed now
- It expands LKQ's common platform footprint, creates the foundation for a more integrated operating model and supports better service…
- For more information, please refer to the risk factors discussed in LKQ's Form 10-K and subsequent reports filed with the...
- While the implementation has been more challenging and taken longer to stabilize than planned, LKQ has identified the issues, implemented…
- Aftermarket collision revenue increased approximately 2%, and LKQ's Canadian hard parts business grew in the mid-single digits, while Paint…
- The year-over-year decline largely reflects lower revenue and profitability in Europe due to the factors Justin mentioned earlier.
Faded since Q1 2026
- Fading LKQ achieved strong performance in its aftermarket collision product line, surpassing the growth levels of the segment.
- Fading Comparable claims were down approximately 2% to 4%, demonstrating steady recovery from the levels LKQ saw throughout 2025.
- Fading LKQ's performance reflected solid execution in North America, improving trends throughout the quarter in Europe and continued focus on…
- Fading In North America, top line performance remained solid despite year-over-year headwinds from repairable claims and tariffs and LKQ believes…
Latest announcements
Official filings, newest first.
- Results of operations · SEC 8-K
- Articles or bylaws amended; Shareholder vote results · SEC 8-K
- Results of operations · SEC 8-K
- Director or officer change · SEC 8-K
- Results of operations · SEC 8-K
- Other events · SEC 8-K
- Material agreement; New financial obligation; Other events · SEC 8-K
- Other events · SEC 8-K