Genuine Parts (GPC) Stock Forecast & Price Target

Genuine Parts is positioned to benefit from improving US trends in the second half of the year, driven by tariff-induced same-SKU inflation and a rise in automotive repair and maintenance activity due to increased new and used car prices. Notably, the company has reported growth in its market for maintenance, repair, and operations (MRO) customers, with EBITDA growth demonstrating strong revenue performance. Additionally, the company's strategic shift toward a heavier mix of company-owned stores is expected to enhance its control over offerings and capitalize on the anticipated demand surge in the market.

Genuine Parts has reported a negative outlook primarily due to a decline in its automotive segment, with Auto EBITDA margins decreasing by approximately 110 basis points year-over-year to 8.6%, attributed to rising labor, rent, and supply chain costs. Additionally, the company has adjusted its Auto EBITDA margin guidance for 2025 to flat or slightly down, indicating potential challenges in maintaining profitability in this segment. Although the industrial segment saw stable EBITDA margins, the 0.1% decline in industrial comps coupled with prolonged uncertainties suggests a risk of market share losses, further contributing to the negative sentiment surrounding Genuine Parts's stock.