Investors in LKQ Corporation (NASDAQ:LKQ) had a good week, as its shares rose 4.3% to close at US$52.18 following the release of its annual results. It was a credible result overall, with revenues of US$14b and statutory earnings per share of US$3.49 both in line with analyst estimates, showing that LKQ is executing in line with expectations. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Taking into account the latest results, the most recent consensus for LKQ from eleven analysts is for revenues of US$15.3b in 2024. If met, it would imply a notable 10% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to increase 5.9% to US$3.74. Before this earnings report, the analysts had been forecasting revenues of US$15.2b and earnings per share (EPS) of US$3.85 in 2024. The analysts seem to have become a little more negative on the business after the latest results, given the minor downgrade to their earnings per share numbers for next year.

It might be a surprise to learn that the consensus price target was broadly unchanged at US$61.10, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on LKQ, with the most bullish analyst valuing it at US$68.00 and the most bearish at US$51.00 per share. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's clear from the latest estimates that LKQ's rate of growth is expected to accelerate meaningfully, with the forecast 10% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 2.2% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 4.9% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that LKQ is expected to grow much faster than its industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for LKQ. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple LKQ analysts - going out to 2026, and you can see them free on our platform here.

Plus, you should also learn about the 3 warning signs we've spotted with LKQ .

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.