Genuine Parts is a distributor of automotive replacement parts and accessories in the U.S., Canada, Mexico and Australasia. The Company also distributes industrial replacement parts in the U.S., Canada and Mexico through its Motion Industries subsidiary. The company was founded in 1928 and is based in Atlanta, Georgia.
GPC Price Forecast Based on DCF Valuation
DCF Fair Value Target:
We started the process of determining a valid price forecast for Genuine Parts Co with a discounted cash flow analysis -- the results of which can be found in the table below. To summarize, we found that Genuine Parts Co ranked in the 25th percentile in terms of potential gain offered. Our DCF analysis suggests the stock is overvalued by about 61.83%. The most interesting components of our discounted cash flow analysis for Genuine Parts Co ended up being:
The company's compound free cash flow growth rate over the past 5.75 years comes in at -0.05%; that's greater than only 21.92% of US stocks we're applying DCF forecasting to.
Genuine Parts Co's weighted average cost of capital (WACC) is 7%; for context, that number is higher than only 16.4% of tickers in our DCF set.
The company's cost of debt, derived from its interest coverage, tax rate, and market capitalization, is greater than just 0% of stocks in its sector (Consumer Cyclical).
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
For other companies in the Consumer Cyclical that have a similar discounted cashflow valuation profile (and ensuing price forecasts) as GPC, try HLT, SMP, VNCE, BFAM, and APTV.
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