Genuine Parts Company (GPC, Financial) announced its third-quarter 2024 results today, but the news wasn't well-received by the market. Shares plunged 20% following the earnings report, as sales reached $6.0 billion, a 2.5% increase from last year. While the Automotive segment showed solid growth, boosted by acquisitions, the Industrial division struggled with a 1.2% decline due to weak demand and challenging European market conditions. Earnings per share took a hit, dropping to $1.62 from $2.49 a year ago, pressured by restructuring expenses and softer industrial sales.
The company also revised its full-year outlook, cutting its revenue growth expectations to 1%-2% from the prior 1%-3% range and slashing its adjusted EPS guidance to $8.00-$8.20, well below the earlier forecast of $9.30-$9.50. These downward revisions reflect the ongoing pressures in the industrial sector and broader economic uncertainty, with geopolitical risks adding to investor concerns.
Despite the market reaction, CEO Will Stengel emphasized that GPC is taking proactive steps to weather the storm, including aggressive restructuring and integrating recent acquisitions to drive efficiency. With $1.1 billion in cash flow from operations year-to-date and free cash flow expectations between $800 million and $1.0 billion for 2024, the company remains focused on positioning itself for a strong recovery once market conditions improve.
