Genuine Parts CompanyGPCNYSE
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Executive Summary

Latest Data: Dec 2025
Consumer CyclicalSpecialty Retail
$17.0BLarge Cap

A large-scale business, operating profitably priced at a premium.

Key Investment Themes
Mature business (3% growth)
Premium valuation (257.3x P/E)

Business Narrative

Genuine Parts Company distributes automotive replacement parts, and industrial parts and materials. It operates through Automotive Parts Group and Industrial Parts Group segments. The company distributes automotive replacement parts for hybrid and electric vehicles, trucks, SUVs, buses, motorcycles, recreational vehicles, farm vehicles, small engines, farm equipment, marine equipment, and heavy duty equipment; and accessory and supply items used by various automotive aftermarket customers, such as repair shops, service stations, fleet operators, automobile and truck dealers, leasing companies, bus and truck lines, mass merchandisers, farms, industrial concerns, and individuals.

Consumer CyclicalSpecialty Retail
Cyclical
Revenue Mix
Single segment business
Bear Case
  • -Premium valuation leaves limited margin of safety

Company at a Glance

Revenue Growth
3%
Profit Margin
0%
Free Cash Flow
$421M
P/E Ratio
257.3x
+284% vs 5Y avg
ELEVATED

Business Performance

Business Scale
Revenue$24.3B
Net Income$66M
Profitability Quality
Gross Margin35%
Operating Margin5%
Net Margin0%
Growth Trajectory
Revenue Growth
3%
EPS Growth
-93%
FCF Growth
-38%

Key Highlights

Watch Areas

  • Thin profit margins under 5%
  • Free cash flow declining despite positive earnings
  • Trading 284% above 5-year average valuation
  • Premium valuation requires continued strong execution

Financial Health

Liquidity
Watch
Current Ratio1.08
1.0-2.0 = Adequate
Cash & Equivalents$477M
Leverage
Watch
Debt / Equity1.87
1.0-2.0 = Moderate
Interest Coverage7.43x
≥5x = Comfortable
Efficiency
Concern
Return on Equity1.5%
<8% = Weak
Return on Capital9.9%
8-15% = Fair

Valuation Assessment

Market Cap
$17.0B
Large Cap
P/E (TTM)
257.3x
Elevated
vs 5Y avg: 67.0x (+284%)
P/S (TTM)
0.7x
Discounted
vs 5Y avg: 0.9x (-21%)
EV/EBITDA
15.6x
In-line
vs 5Y avg: 13.3x
(+18%)
P/E Historical Range (5Y)
Min: 14.8xAvg: 67.0xNow: 257.3xMax: 259.1x
P/S Historical Range (5Y)
Min: 0.7xAvg: 0.9xNow: 0.7xMax: 1.1x
EV/EBITDA Historical Range (5Y)
Min: 10.8xAvg: 13.3xNow: 15.6xMax: 14.5x

Valuation Corridor

FAIR
FCF Yield
2.5%
vs Cost of Capital ~8.0% = Moderate
P/E Corridor (5Y)257.3x
14.8xFair: 14.8x-174.4x259.1x
P/S Corridor (5Y)0.7x
0.7xFair: 0.7x-1.1x1.1x
EV/EBITDA Corridor (5Y)15.6x
10.8xFair: 11.7x-14.5x14.5x

Detailed Financials

Comprehensive financial statement data for deep analysis

MetricDec 21Dec 22Dec 23Dec 24Dec 25
Return on Equity
-
-
-
-
-
Return on Invested Capital
-
-
-
-
-
Gross Margin
35.2%
35.0%0.4%
35.9%2.5%
36.3%1.1%
34.6%4.7%
Operating Margin
6.2%
7.3%18.5%
7.6%3.6%
6.1%18.8%
5.0%18.6%
Net Margin
4.8%
5.4%12.4%
5.7%6.5%
3.8%32.5%
0.3%93.0%
Earnings Yield
-
-
-
-
-
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