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Yahoo
29-05-2025
- Automotive
- Yahoo
Genuine Parts Company (GPC): A Bull Case Theory
We came across a bullish thesis on Genuine Parts Company (GPC) on Substack by Serhio MaxDividends. In this article, we will summarize the bulls' thesis on GPC. Genuine Parts Company (GPC)'s share was trading at $125.09 as of 21st May. GPC's trailing and forward P/E were 20.54 and 16.05 respectively according to Yahoo Finance. An engineer at a workbench surrounded by automotive parts, tools, and microchips. Genuine Parts Company (GPC) may not capture headlines, but its steady, dividend-driven wealth creation makes it a core holding for long-term investors. Founded in 1928, this Atlanta-based distributor of automotive and industrial parts—best known through its NAPA Auto Parts brand—has grown into a global powerhouse with a diversified and recession-resistant business model. Its consistent performance is underscored by an elite 70-year streak of uninterrupted dividend growth, earning it a spot among the Dividend Kings. Currently yielding 3.48% with a conservative 49% payout ratio, GPC offers dependable income underpinned by growing earnings and strong free cash flow. Its two core segments—automotive and industrial—benefit from steady demand, and the company is expanding into high-growth areas like electric vehicle parts and commercial fleet services. A robust international footprint and ongoing investments in digital infrastructure and R&D further support long-term expansion. With a near-perfect financial score of 98/99 and a solid track record through market cycles, GPC is well-positioned for continued 6.2% annual revenue growth and a 7.5% CAGR through 2026. Despite its modest P/E ratio around 18 and a "fairly valued" stock price, the quality of its earnings and operational consistency justify the premium. Institutional ownership from firms like Vanguard and BlackRock adds further credibility. While GPC may not deliver explosive gains, it offers a rare combination of durability, income, and gradual appreciation. For conservative investors seeking a 'set it and forget it' anchor with long-term upside and minimal downside, GPC is a high-conviction bet in an unpredictable market. Genuine Parts Company (GPC) is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 36 hedge fund portfolios held GPC at the end of the fourth quarter which was 27 in the previous quarter. While we acknowledge the risk and potential of GPC as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than GPC but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock. READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock. Disclosure: None. This article was originally published at Insider Monkey. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
18-04-2025
- Automotive
- Yahoo
Is Genuine Parts Company (GPC) The Top Auto Parts Stock That Could Surge On Trump's Auto Tariff Relaxation?
We recently published a list of . In this article, we are going to take a look at where Genuine Parts Company (NYSE:GPC) stands against other top auto parts stocks that could surge On Trump's auto tariff relaxation. The corporate earnings season is about to kick off, but investors have something else on their minds: Donald Trump's tariffs. Since the beginning of his term, Trump has wreaked havoc on the markets with repeated tariffs, resulting in the S&P index being down nearly 8% for the year. We have observed that some of the most aggressive tariff policies are soon revoked or relaxed, resulting in a rally that brings back the stock prices to reasonable levels. We saw this recently when Donald Trump hinted that Big Tech companies may not bear the brunt of the tariffs as badly as previously thought. As a result, investors poured their money into these companies, thinking they may be critical for the US infrastructure. A similar development is forming in the auto sector, with Trump likely to offer some relaxation when it comes to importing auto parts or manufacturing vehicles outside the US. Since auto parts companies are critical to the supply chain of this industry, we decided to take a look at the auto parts stocks that could surge following any news of relaxation in tariffs. To come up with our list of Top 10 Auto Parts Stocks that could surge following Trump's auto tariff reprieve, we looked at companies in the auto parts industry with a minimum market cap of $300 million that were outperforming their peers. A line of mechanics diagnosing a recreation vehicle engine at a repair shop. Genuine Parts Company operates as an industrial and automotive replacement parts distributor. The company operates through Industrial Parts Group and Automotive Parts Group segments. It supplies accessories, automotive parts, replacement parts and solutions for SUVs, motorcycles, hybrid & electric vehicles, buses, and other vehicles. The company recently reported its Q4 2024 results, demonstrating a 3.3% YoY increase in top-line sales. Gross profit increased by 1.8% YoY, reaching $2.1 billion. The firm had a slightly higher debt due to insufficient operating cash flow to fund investing activities. A part of operating cash flow was used for share buybacks and dividend payments, a move questioned by many in the context of increasing debt. CFO Bert Nappier highlighted the company's focus on cost control by mentioning: 'Our global restructuring efforts announced last year have progressed ahead of plan, delivering cost savings at the high end of expectations.' For 2025, the company expects 2% to 4% total sales growth aided by recovery in European and industrial markets in the latter half of the year. With the help of restructuring efforts, the firm anticipates producing additional savings valued between $100 million and $125 million in 2025. Overall, GPC ranks 6th on our list of top auto parts stocks that could surge On Trump's auto tariff relaxation. While we acknowledge the potential of GPC as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than GPC but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock. READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires. Disclosure: None. This article is originally published at Insider Monkey. Sign in to access your portfolio
Yahoo
13-04-2025
- Automotive
- Yahoo
1 "Safe Stock" That Will Thrive No Matter What Happens With Tariffs
One thing is clear after a wild week of President Donald Trump's tariff roulette. Nobody knows where the market is going in the short term, and the decisions of one person are moving trillions of dollars in market value. It's an incredibly difficult environment to invest in. Even after the 90-day pause, the uncertainty surrounding trade policy and the global economy remains. What will happen when the 90-day pause is over? Will China and the U.S., the world's two biggest economies, remain in an all-out trade war? Can businesses confidently invest and hire in such a volatile environment? We don't know the answers to those questions. At times like these, one of the best choices investors can make is to put their money into safe stocks that can do well no matter what happens with tariffs and the global economy. One of the best candidates out there is AutoZone (NYSE: AZO), the aftermarket auto parts retailer that has trounced the market over its history, outperforming it by an even wider margin in bear markets. What's more impressive about AutoZone is that it has generated superior returns in virtually every kind of market environment, and that it tends to be unbothered by disruptions like Trump's tariffs. In one sign of that resilience, on April 3, the first day of the drop after Trump announced the tariffs, AutoZone stock gained 0.4%, though it later slipped in sympathy with the broader market pullback. AutoZone has two primary advantages working for it in challenging times. First, it operates in a countercyclical business. Demand for aftermarket auto parts tends to increase in challenging times as people forego or delay purchasing a new car. Since most spending on auto parts is necessary to keep a car operating, AutoZone benefits as car owners spend on repairs instead of buying new cars. That's why its comparable sales typically accelerate during recessions. The other advantage the company has that has helped it outperform peers like Advance Auto Parts and Napa parent Genuine Parts Company is its strong business operations and execution. It now has more than 7,000 stores, with 6,000 locations across the U.S., and locations in Mexico and Brazil. It primarily serves the DIY channel, with 80% of its sales coming from walk-in customers, while the remaining 20% comes from sales to repair shops and other professional businesses. It also carries a wide range of products, as most of its stores have 20,000 to 25,000 SKUs, and it uses a hub-and-spoke model. Hub stores carry 40,000 to 50,000 SKUs, and mega-hub stores carry 80,000 to 110,000 SKUs. That model has worked well, as the hub stores can reinforce the smaller ones as needed. AutoZone benefits from its proprietary systems, including an electronic catalog and point-of-sale that help with things like customer service, inventory management, merchandising, and product returns. Superior operations and the countercyclical nature of the auto parts industry should continue to make AutoZone resilient in economic downturns. Management has also driven the stock's outperformance through consistent share buybacks, reducing shares outstanding by about 50% over the last 10 years. Like most retailers, AutoZone is exposed to tariffs, and many of the products it sells come from outside the U.S. However, management is confident that it can handle tariffs. In the recent earnings call in March, it said that it intends to maintain its margin profile after tariffs, meaning that it will pass on costs if needed. Because most of the products the company sells aren't discretionary, it can pass along those costs. As CFO Jamere Jackson put it: "The lion's share of our business is relatively inelastic." The tariff situation remains highly fluid even after the 90-day pause announcement, but based on its track record, operational success, and countercyclical business, AutoZone stock looks well-positioned for growth no matter what happens with tariffs. In a rocky market, it's a rock-solid buy. Before you buy stock in AutoZone, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and AutoZone wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $495,226!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $679,900!* Now, it's worth noting Stock Advisor's total average return is 796% — a market-crushing outperformance compared to 155% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of April 5, 2025 Jeremy Bowman has no position in any of the stocks mentioned. The Motley Fool recommends Genuine Parts. The Motley Fool has a disclosure policy. 1 "Safe Stock" That Will Thrive No Matter What Happens With Tariffs was originally published by The Motley Fool Sign in to access your portfolio
Yahoo
09-04-2025
- Business
- Yahoo
Buying the Dip: 3 Super Safe High-Yield Dividend Stocks I Added to My Retirement Account During the Stock Market Sell-Off.
The stock market recently took a big dip, driven down by concerns about how much tariffs will affect the economy. One of the benefits of falling stock prices is that dividend yields move in the opposite direction. That allows investors to lock in even higher yields on some high-quality dividend stocks. I recently capitalized on the dip in the market to deploy some cash in my retirement account to add to my position in several top-notch dividend stocks, including VICI Properties (NYSE: VICI), Verizon (NYSE: VZ), and Genuine Parts Company (NYSE: GPC). Here's why I think they are low-risk stocks to buy amid the current market turmoil. Amid the market downturn, VICI Properties' stock has dipped more than 10% from its recent peak. That has driven up the dividend yield of the real estate investment trust (REIT) to 5.7%, well above the S&P 500's 1.5% yield. The REIT's high-yielding payout is on a very safe footing. It produces very stable cash flow from its portfolio of high-quality experiential real estate, like casinos and sports and entertainment complexes. It leases these properties to operating tenants under very long-term triple net leases (NNNs), which currently have an average remaining term of 41 years. An increasing percentage of its leases index rents to inflation (42% this year, rising to 90% by 2035). Because of that, it generates very stable and growing rental income. VICI Properties has a very strong financial profile that gives it the flexibility to continue investing in income-producing experiential real estate. Its growing portfolio enables the REIT to increase its dividend. It has raised it for seven straight years (every year since its formation), at a 7% compound annual rate, well above the 2% average annual rate of its net lease peers. Verizon's shares have slumped more than 7% from their recent peak. That has pushed the telecom giant's dividend yield up to 6.3%. That high-yielding dividend is super safe. Verizon produces lots of durable cash flow as businesses and consumers pay their wireless and broadband bills. The company earned $36.9 billion in cash flow from operations last year and $19.8 billion in free cash flow (FCF) after funding capital expenditures, which was more than enough to cover its dividend outlay of $11.2 billion. Verizon used the remaining excess FCF to strengthen its already rock-solid balance sheet. The company is using some of its financial flexibility to acquire Frontier Communications in a $20 billion all-cash deal to bolster its broadband network. That deal and the continued capital investments to organically grow its fiber and 5G networks put Verizon in position to grow its revenue and cash flow in the future. That should enable the company to continue increasing its dividend, which it has done for a sector-leading 18 years in a row. Genuine Parts Company has sold off sharply during the recent market downdraft, falling over 30%. That slump pushed the automotive and industrial parts distributor's dividend yield up to 3.7%. There are some concerns that tariffs could have a meaningful impact on the automotive sector, given the volume of parts imported into the country. While this headwind could affect Genuine Parts' business, it has weathered adverse conditions before, demonstrating its resilience by increasing its dividend for 69 years in a row. The company has a strong financial profile to support its high-yielding dividend amid the current market uncertainty. Last year, Genuine Parts produced $1.3 billion in cash flow from operations and $684 million in FCF. That was more than enough to cover the $555 million it paid in dividends. It has a strong balance sheet with lots of liquidity ($2 billion, including $480 million of cash and equivalents). That gives it a lot of financial flexibility to continue investing in growing its business and making acquisitions, including buying independent NAPA Auto Parts stores in the top markets. These investments should help grow its revenue and cash flow over the long term, supporting the continued rise in its dividend. Shares of VICI Properties, Verizon, and Genuine Parts Company have dipped during the recent stock market sell-off, which has pushed their dividend yields even higher. Given the durability of their cash flows and the strength of their financial profiles, those payouts are very safe. That's why I've capitalized on the recent sell-off to buy even more shares for my retirement account to increase the amount of their super-safe income that I will collect in the years to come. Before you buy stock in Vici Properties, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Vici Properties wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $461,558!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $578,035!* Now, it's worth noting Stock Advisor's total average return is 730% — a market-crushing outperformance compared to 147% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of April 5, 2025 Matt DiLallo has positions in Genuine Parts, Verizon Communications, and Vici Properties. The Motley Fool recommends Genuine Parts, Verizon Communications, and Vici Properties. The Motley Fool has a disclosure policy. Buying the Dip: 3 Super Safe High-Yield Dividend Stocks I Added to My Retirement Account During the Stock Market Sell-Off. was originally published by The Motley Fool Sign in to access your portfolio
Yahoo
08-04-2025
- Automotive
- Yahoo
Analysts Pick 2 ‘Tariff-Protected' Stocks to Weather Macro Storms
After months of uncertainty, President Trump unveiled his tariff policy last week – and to say the markets didn't take it well would be a bit of an understatement. The announcement has triggered a wave of sharp market selloffs across the globe, shaking investor confidence and sparking fears of a looming recession. Discover outperforming stocks and invest smarter with Top Smart Score Stocks. Filter, analyze, and streamline your search for investment opportunities using Tipranks' Stock Screener. The main question now is, will Trump's policies inflict lasting harm, or will they be more in the nature of 'short-term pain and long-term gain'? Only time will tell. The one thing that everyone does agree on, however, is that we're facing serious market chaos right now – and we need to find the right stocks to weather this storm. This is what some of Wall Street's top analysts are doing – picking out 'tariff-protected' stocks, shares that stand to gain under the new tariff regime. We've used the TipRanks platform to find out the broader Wall Street view on two of these stocks. Let's dive in. Genuine Parts Company (GPC) We'll start with Genuine Parts Company, a vital player in the automotive repair industry, as well as the general industrial maintenance field. The company was founded in 1928 and today is a $16 billion giant, manufacturing and distributing a wide range of both automotive and industrial replacement parts worldwide. Genuine Parts has well over 10,000 locations in 17 countries, operating in the North American, European, and Australasian regions and employing some 63,000 people. The company operates through subsidiaries which are organized into two broad divisions, the Automotive Parts Group and the Industrial Parts Group. The famous NAPA brand falls under the Automotive group, along with its branches in Canada, Europe, and Australasia; the Industrial Parts Group covers the Motion Industries name. On the automotive side, the company offers over 800,000 quality-made aftermarket replacement parts, used by garages, do-it-yourselfers, and auto fanatics. The Industrial Parts Group offers more than 18 million replacement parts, in a wide range of industries, to maintenance, repair, and operations (MRO) and original equipment manufacturer (OEM) customers. All of this has made GPC a vital player in global industry. The global footprint gives this company an advantage in a competitive tariff regime. With diverse lines of supply, manufacturing, and distribution, GPC has plenty of options for providing locally made parts in many markets. In addition, as tariff competitions drive up prices, GPC stands to make gains in the maintenance and do-it-yourself fields. Automobiles present a likely scenario: tariffs will likely push up prices, at least in the short term, encouraging drivers to keep existing cars on the road longer — and that will drive up maintenance and repair costs, whether it's DIY or at a garage. A similar dynamic supported GPC stock during the COVID pandemic period. On its financial side, GPC reported $5.8 billion at the top line in 4Q24, beating the forecast by $90 million and growing 3.3% year-over-year. The company's bottom line, reported as a non-GAAP EPS of $1.61, was 6 cents per share better than had been anticipated. For the full year 2024, the company's total sales came to $23.5 billion, up 1.7% year-over-year. Looking ahead, the company expects to register 2025 full-year revenue growth between 2% and 4%, which is roughly in-line with the analyst consensus of 3.15%. This stock has caught the attention of 5-star analyst Greg Melich, from Evercore ISI, who sees multiple paths for the company to survive a tariff storm — even apart from its ability to onshore manufacturing. Melich writes of the stock, 'We view GPC as one of the better insulated companies in our coverage from a tariff perspective, with the ability to pass through rising prices in both its Auto & Industrial segments, there is even a possibility that earnings may move higher from tariffs. While we are currently below the Street, with the stock trading at ~14x depressed C26 EPS and end markets largely depressed, we believe that much of the risk associated with a choppy low-income consumer and tariffs is baked in.' 'GPC appears well positioned to play offense with respect to capturing share losses from AAP as the closed stores should result in migration of independents from the CarQuest network to NAPA which would ultimately help GPC,' Melich goes on to add. 'Plus, restructuring actions are reducing the cost structure, set to provide another $100-125mn (40-60bps of EBIT margin) of incremental savings through 2026. To the extent manufacturing in U.S. is supported by onshoring Industrial demand would likely benefit from higher capacity utilization and even new projects.' Melich quantifies his stance here with an Outperform (i.e., Buy) rating, and a $135 price target that points toward a 15.5% gain in the next 12 months. (To watch Melich's track record, click here) Overall, this stock has earned a Moderate Buy consensus rating from the Street's analysts, based on 7 reviews that include 4 Buys, 2 Holds, and 1 Sell. The stock's trading price of $116.81 and average target price of $131.83 together suggest a one-year upside potential of 13%. (See GPC stock forecast) TJX Companies (TJX) The second stock we'll look at here is a long-standing name in discount retail. TJX Companies is the parent firm of TJ Maxx, its flagship chain, as well as Marshalls, HomeGoods, and HomeSense. On the international scene, the company chains include TK Maxx in Europe and Australia, along with the Marshalls, HomeSense, and Winners names in Canada. In all, the company has more than 5,000 stores in 9 countries on 3 continents, and has been in business for 47 years. The TJX chains are best known as discount department stores, offering customers access to high-quality goods, with fashionable brand names, for sharp discounts compared to full-price retailers. The company's discounts typically fall in the 20% to 60% range, and TJX is widely recognized as a leader in the off-price retail space. TJX Companies achieves its off-price dominance through several strategies. Prominent among these are bare-bones store activities and, as the company puts it, smart shopping. The firm does not engage in large-scale promotional activities – it boasts that it does not offer sales or coupons, because its regular prices are already attractive. In addition, the firm maintains a diverse supply chain, and trains its buyers to seek out discounted merchandise. TJX is known for picking up brand-name goods that were overproduced by suppliers, or were overbought by full-price retailers. Both routes offer an opening for a discount seller to negotiate lower prices. In its last reported quarter, which covered fiscal 4Q25, the company had a revenue total of $16.35 billion. This was down slightly year-over-year, by 0.4%, but beat expectations by $110 million. On earnings, the company's $1.23 EPS was 6 cents per share better than the forecast. Full year revenue in fiscal 2025, which ended on February 1 of this calendar year, came to $56.4 billion, up 4% year-over-year. The company reported a 5% increase in its consolidated comparable store sales for Q4, with the increase driven by growth in customer transactions. That last point may be a key to how TJX can navigate the tariff shake-up. In a difficult economic environment, consumers feel a squeeze – and that can drive traffic at discount retailers. Citi analyst Paul Lejuez notes that point, as well as TJX's ability to source products at low prices, as strong supporting factors for the stock going forward. He writes of TJX, 'Tariffs are likely to create significant disruption in the mkt, greatly increasing the availability of product available to off-pricers at attractive prices. At the same time, a potentially weakening consumer environment will mean more consumers are likely to trade down to the off-price channel in search of value (and the treasure hunt shopping experience)… We expect TJX to benefit from the attractive buying environment, helping sales and margins in the near-term. The company has significant momentum and had a strong holiday season (comps +5% in 4Q) and while comps were softer in Feb, we believe that was largely due to weather.' Lejuez goes on to rate TJX stock as a Buy, and gives the shares a price target of $140, implying that a 12-month gain of 14.5% lies ahead for the retailer. (To watch Lejuez's track record, click here) There are 19 recent analyst reviews on record for this stock, and their lopsided split of 18 Buys to 1 Hold give TJX a Strong Buy consensus rating. The stock is currently trading at a price of $122.16 and its $141.41 average target price suggests an upside of 16% in the coming year. (See TJX stock forecast) To find good ideas for stocks trading at attractive valuations, visit TipRanks' Best Stocks to Buy, a tool that unites all of TipRanks' equity insights. Disclaimer: The opinions expressed in this article are solely those of the featured analysts. The content is intended to be used for informational purposes only. 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