Genuine Parts Third Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component Genuine Parts (NYSE:GPC) will unveil its latest earnings on Thursday, October 18, 2012. Genuine Parts Company distributes automotive replacement parts, industrial replacement parts, office products and electrical/electronic materials.

Genuine Parts Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average analyst estimate is for net income of $1.12 per share, a rise of 15.5% from the company’s actual earnings for the year-ago quarter. The average estimate is the same as three months ago. Between one and three months ago, the average estimate was unchanged. It also has not changed during the last month. Analysts are projecting profit to rise by 13.4% versus last year to $4.06.

Past Earnings Performance: Last quarter, the company saw profit of $1.08 per share versus a mean estimate of net income of $1.08 per share. This comes after two consecutive quarters of exceeding expectations.

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A Look Back: In the second quarter, profit rose 11.1% to $168.6 million ($1.08 a share) from $151.8 million (96 cents a share) the year earlier, meeting analyst expectations. Revenue rose 4.8% to $3.34 billion from $3.18 billion.

Wall St. Revenue Expectations: On average, analysts predict $3.48 billion in revenue this quarter, a rise of 5.8% from the year-ago quarter. Analysts are forecasting total revenue of $13.23 billion for the year, a rise of 6.2% from last year’s revenue of $12.46 billion.

Stock Price Performance: Between July 19, 2012 and October 12, 2012, the stock price fell $3.08 (-4.8%), from $64.37 to $61.29. The stock price saw one of its best stretches over the last year between November 25, 2011 and December 5, 2011, when shares rose for seven straight days, increasing 11.7% (+$6.35) over that span. It saw one of its worst periods between February 16, 2012 and February 27, 2012 when shares fell for seven straight days, dropping 5.2% (-$3.38) over that span.

Key Stats:

This upcoming earnings announcement will be a chance to build on positive earnings momentum over the last three quarters. Net income rose 13.7% in the fourth quarter of the last fiscal year and 15.6% in the first quarter before increasing again in the second quarter.

On the top line, the company is looking to build on four-straight revenue increases heading into this earnings announcement. Revenue rose 11.4% in the third quarter of the last fiscal year, 7.4% in the fourth quarter of the last fiscal year and 7% in the first quarter before increasing again in the second quarter.

Analyst Ratings: There are mostly holds on the stock with six of seven analysts surveyed giving that rating.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 2.24 last quarter. Having a ratio above 2:1 is usually considered a good indicator of a company’s liquidity and ability to meet creditor demands. The company regressed in this liquidity measure from 2.38 in the first quarter to the last quarter driven in part by a decrease in current assets. Current assets decreased 3.9% to $4.42 billion while liabilities rose by 2.4% to $1.98 billion.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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