Junkyard giant LKQ plunges
“We are not where we need to be,” its CEO says.
Giant automotive scrapyard owner LKQ Corp. tumbled in early trading after reporting second-quarter profits that fell short of Wall Street expectations and revising its full-year profit guidance lower.
The company’s CEO, Justin Jude, told analysts he “can’t sugarcoat” the lack of progress the company has made since he took over roughly a year ago, adding, “We are not where we need to be.”
Earnings per share of $0.87 fell about 6% short of Wall Street’s expectation for $0.92. Sales of $3.64 billion slightly topped expectations for $3.62 billion.
The stock’s roughly 20% tumble worsened ongoing underperformance of the shares, which are now down more than 25% over the last 12 months, compared to a roughly 17% gain for the S&P 500.
Part of the challenge the company faces is that sky-high US auto insurance prices are prompting drivers to live with the dents and scrapes from fender benders and other mishaps, rather than file insurance claims that would raise already high premiums.
