Roth Capital Sees Value in LKQ (LKQ) Despite Operational Headwinds

LKQ Corporation (NASDAQ:LKQ) is one of the deep value stocks to buy according to analysts. On July 25, Roth Capital’s Scott Stember cut his price target on LKQ Corp. to $46 from $56 but kept a Buy rating on the stock. The revision followed a weaker-than-expected second quarter, with EPS falling short and management lowering its 2025 guidance.

The analyst emphasized on the ongoing headwinds in both the U.S. and Europe. In North America, he says that demand in the collision repair market is recovering at a slower pace than anticipated. On the other side, in Europe, operational missteps have weighed on results. Despite these challenges, he believes LKQ’s long-term fundamentals remain intact and that the stock offers value for patient investors.

From a financial standpoint, LKQ reported Q2 2025 revenue of $3.6 billion, a 2% year-over-year decrease, with organic revenue decline of 3.4% in its parts and services segment. Adjusted EPS was $0.87, reflecting an 11% decline year over year. Free cash flow generation remained good at $243 million for the quarter, keeping the company on track to achieve its revised full-year guidance of $600-$750 million (down from $750-$900 million earlier).

LKQ Corporation (NASDAQ:LKQ) is a leading provider of alternative and specialty parts to repair and accessorize automobiles and other vehicles.

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Disclosure: None. This article is originally published at Insider Monkey.