Genuine Parts (GPC) Stock Forecast & Price Target

Genuine Parts demonstrates a positive outlook due to anticipated improvements in U.S. trends, driven by tariff-induced same-SKU inflation and an uptick in repair and maintenance activities linked to rising new and used car prices. The company has reported mid-single-digit growth among its Maintenance, Repair, and Operations (MRO) customers, with industrial EBITDA margins increasing by 24 basis points year-over-year, marking the first positive comparison in six quarters. Additionally, the strategic shift towards a heavier mix of company-owned stores is expected to enhance the company’s control over offerings and capitalize on imminent demand growth opportunities.

Genuine Parts Company's automotive segment has experienced a decline in EBITDA margins by approximately 110 basis points year-over-year to 8.6%, primarily attributed to rising labor, rent, and supply chain costs, which raises concerns about the segment's profitability. Additionally, the company has revised its Auto EBITDA margin guidance for 2025 to flat/slightly down, indicating a potentially challenging operational environment amid ongoing pressures. Furthermore, despite maintaining a slight increase in Industrial EBITDA margins, the decline in industrial comps of 0.1% and overall uncertainty, including potential tariff impacts, suggest vulnerabilities that could hinder long-term growth prospects.