CluenexLKQ Corporation LKQ
LKQ Corporation scores weak on business quality (3.9 of 10). Here is why, in plain words, and what our sealed record shows.
Why it matters
- What LKQ Corporation does
LKQ distributes replacement parts, components, and systems used in the repair and maintenance of vehicles. Insurers, collision repair shops, and retail customers pay for these parts to restore damaged cars.
- What it does best
LKQ scales an extensive distribution network for alternative vehicle parts that competitors struggle to match. It posts a gross margin of 38.3%, outperforming peer POOL at 29.6%, securing a resilient pricing edge in collision repair components.
- The main risk
Sluggish claims volume threatens top-line growth, prompting Fitch to revise its outlook to stable. Lower accident and repair frequencies directly compress the revenue needed to service its $3.7 billion total debt load.
Quality, check by check
Scored against its own industry, from company filings.
Operating margin lands at 7.2% while FCF margin hits 32.0% of net income, producing low returns with an ROE of 7.1%. Profitability remains pressured as revenue shrinks and costs weigh on margins.
Scale and logistics create an asset-heavy distribution moat protecting relationships with collision repair shops. It ranks in the 46th percentile for gross margin, showing an average moat width in the sector.
Revenue contracted 1.2% to $13.7 billion, showing a clear top-line fade compared to prior annual periods where revenue held flat or drifted lower from a $13.8 billion peak.
Total debt sits at $3.7 billion with interest coverage at 4.6x, leaving debt costs manageable. Free cash flow reached $625 million, supporting $308 million in dividends while the balance sheet softens.
Insiders
Executives and directors, from SEC Form 4 filings we read ourselves. Open market trades only; grants, option exercises and pre-planned sales left out.
No open market buys or unplanned sales by executives or directors.
Our sealed record on LKQ
Verdicts appear here 30 days after we publish them; members see today's. Each one is in the nightly ledger, fingerprinted the night it was made.
The first sealed verdicts appear here on Oct 11, 2026.
Questions
LKQ Corporation scores weak on the Cluenex quality check (3.9 of 10), measured against its own industry. Profitability is weak, moat fair, growth slow and financial health fair.
In the last 90 days of SEC Form 4 filings: No open market buys or unplanned sales by executives or directors.
Oct 29, 2026.
See LKQ today
- Today's verdict on LKQ, and why
- Fair value with cautious, base and optimistic cases
- The exact price that would change the verdict
- Which stocks each signal names, the night it fires
Cite this page: Cluenex, “LKQ Corporation (LKQ)”, https://cluenex.com/stocks/lkq/, data as of Oct 10, 2026.