Lombardi: Expert Stock Market Commentary & Forecasts, Financial & Economic Analysis Since 1986
Stock Market Commentary & Forecasts, Financial & Economic Analysis

Welcome to Profit Confidential • Wednesday, May 23, 2012

Recycled Auto Parts Could Benefit More Than the Environment

Thursday, July 13th, 2006
By Mitchell Clark, B.Comm. for Profit Confidential

If it’s one business I don’t understand it’s the auto parts business. When I go to my mechanic, he keeps the old parts that he replaced and sells them to a recycler. You might say that an automobile repair shop is at the forefront of recycling. Just about every used part or lubricant gets recycled in some fashion.

There are large companies out there that specialize in the collection of used auto parts (all parts from engine components to transmissions to rims), and they resell refurbished parts back to automobile repair shops or other end users.

This business has been around for quite a long time, but I’ve never really thought about until I came across a company called LKQ Corporation (NASDAQ/LKQX). This company considers itself to be one of the largest suppliers of recycled original equipment manufacturer (OEM) auto parts and assemblies. The company sells to thousands of collision-repair businesses, service shops and vehicle dealerships throughout the United States. The company has 50 locations with state-of-the-art vehicle procurement, dismantling, inventory, sales, and distribution services.

Business must be good in the used auto parts business because

LKQ Corporation has been quite successful on the stock market.

In the first quarter of 2006, the company generated record financial growth with revenues growing 44% to $192.1 million, up from revenues of $133.8 million in the first quarter of 2005. The company’s organic revenue growth for the quarter was 12.4%, while the rest was due to acquisitions.

Net income for the first quarter of 2006 also grew 44% to $12.1 million, up from net income of $8.4 million generated in the first quarter of 2005.

For the second quarter of 2006, the company currently expects its net income to rise to between $10.0 million and $11.0 million. Clearly, this company is executing its business plan right with this solid profitability.

The next time you take your car or truck in for a repair, rest assured that there is a very large and profitable used auto parts industry that will be using your old parts. Not always, but sometimes these “traditional-type” businesses can make for the very best of investments.

Next Post:
Previous Post:

Tags: , , ,










Sign Up for PROFIT CONFIDENTIAL and
receive a FREE copy of our exclusive report:
"A GOLDEN OPPORTUNITY FOR STOCK MARKET INVESTORS"

Enter e-mail:

We respect your privacy and
will never share your e-mail address.



Profit Confidential AuthorMitchell is a Senior Editor at Lombardi Financial specializing in small-cap stocks. He’s the editor of a variety of popular Lombardi Financial newsletters, such as Penny Stock Reporter, Micro-Cap Stocks, and Monster Profits. Mitchell, who has been with Lombardi Financial for thirteen years, won the Jack Madden Prize in economic history and is a long-time student of equity markets. Prior to joining Lombardi, Mitchell was as a stock broker for a large investment bank. While Mitchell is not working he enjoys fly fishing, motorcycling and tending to his hobby farm.

Daily Profits


Enter your e-mail address to subscribe to
Profit Confidential — IT'S FREE!
Enter e-mail:
ALSO RECEIVE A FREE COPY of our exclusive report:
"A Golden Opportunity for Stock Market Investors"

McAfee SECURE sites help keep you safe from identity theft, credit card fraud, spyware, spam, viruses and online scams

 

Corporate
About Us
Privacy
Disclaimer
Contact Us
White List
Sitemap

Profit Confidential
Predictions
Gurus
Archives
FREE Sign-Up
RSS
Twitter
Facebook

Editors
Michael Lombardi
George Leong
Mitchell Clark
Tony Jasansky
Robert Appel
Wendy Potter
Sasha Cekerevac

Topics
Gold Stocks
Stock Market
Bear Market
Bull Market
US Dollar
Euro
Interest Rates

Expertise
U.S.Deficit
Real Estate Market
Debt Crisis
Chinese Economy
Economic Analysis

Guidance
Investment Guidance
Retirement Plan
Chinese Stocks
The Best Stocks
Gold Stock Picking
Real Estate Investment

Resources
Gold
Precious Metals
Real Estate News
Gold Investments
Investing in Real Estate


Profit Confidential Disclaimer