QUOTE AND NEWS
SeekingAlpha  Jul 21  Comment 
Genuine Parts Company (NYSE:GPC) Q2 2014 Earnings Conference Call July 21, 2014 11:00 ET Executives Sid Jones - Vice President, Investor Relations Tom Gallagher - Chairman and Chief Executive Officer Paul Donahue - President ...
newratings.com  Jul 21  Comment 
WASHINGTON (dpa-AFX) - Genuine Parts Company (GPC) reported second-quarter net income of $197.7 million compared to $216.4 million, previous year. Earnings per share were $1.28 compared to $1.39, last year. Before the one-time adjustment in 2013,...
Market Intelligence Center  Jul 21  Comment 
After Friday’s trading in Genuine Parts Co (GPC) the algorithms behind MarketIntelligenceCenter.com's Artifical Intelligence Center picked out a trade that offers a 2.42% or 7.13% (for comparison purposes only), while providing 4.82% downside...
SeekingAlpha  Jul 16  Comment 
By Eli Inkrot: In a recent article I detailed how selling or waiting to buy could expose you to the risk of "losing out on the ultimate bonanza." Within this commentary, I used three specific forward looking examples - Coca-Cola (NYSE:KO), Genuine...
Market Intelligence Center  Jul 9  Comment 
Genuine Parts Co (GPC) traded between $87.78 and $88.40 before closing at $87.88 Tuesday and presents some attractive trading opportunities today. MarketIntelligenceCenter.com’s patented algorithms selected a Nov. '14 $90.00 covered call for a...
Market Intelligence Center  Jun 27  Comment 
For a hedged play on Genuine Parts Co (GPC), MarketIntelligenceCenter.com’s option-trade picking algorithms recommend the Nov. '14 $85.00 covered call for a net debit in the $82.86 area. That is also the break-even stock price for the covered...
SeekingAlpha  Jun 25  Comment 
By Valuentum: History has revealed that the best-performing stocks during the previous decades have been those that shelled out ever-increasing cash to shareholders in the form of dividends. This makes a lot of sense, as the strongest dividend...
newratings.com  Jun 17  Comment 
WASHINGTON (dpa-AFX) - Automotive aftermarket distributor Genuine Parts Co. (GPC) announced an acquisition for its Office Products Group. S. P. Richards Company, the company's Office Products Group, has agreed to acquire Impact Products,...
SeekingAlpha  May 29  Comment 
By Dividend Growth Investor: Genuine Parts Company (GPC) distributes automotive replacement parts, industrial replacement parts, office products, and electrical/electronic materials in the United States, Puerto Rico, the Dominican Republic,...
SeekingAlpha  May 22  Comment 
By Kerry Prazak, CFP: Genuine Parts Company (GPC), headquartered in Atlanta, GA, distributes automotive replacement parts, industrial replacement parts, office products, and electrical/electronic materials in the United States, Puerto Rico, the...




 

Genuine Parts Company (NYSE:GPC) distributes automotive parts and industrial replacement parts (engine parts for heavy machinery) to auto repair businesses and manufacturers. The company also sells office products to large retailers. GPC operates in a mature market with many players, and the products it distributes are commodities with many substitutes available in the marketplace, resulting in ongoing pricing pressure from competitors.

DEI auto sales have also been negatively affected by the trend of longer lasting manufacturers warranties. Over the last several years longer warranties have become the industry standard on new cars; when cars are under warranty, drivers are more likely to go to the car dealership for free repairs, than to visit DEI's clients.

Company Overview

Business Financials

In 2009, GPC earned a total of $10.0 billion in total revenues. This was a significant decline from its 2008 total revenues of $11.0 billion. Unsurprisingly, this had a negative impact on GPC's net income. Between 2008 and 2009, GPC's net income declined from $475 million in 2008 to a net income of $400 million in 2009.[1]

Business Segments

Genuine Parts Co. divides its business into four segments: Automotive Parts , Industrial Machinery Parts, Office Products, and Electrical/Electronic Materials (insulating and conducting materials). Its Automotive Parts group distributes over 300,000 products to retail customers through its 58 NAPA (National Automotive Parts Association) distribution centers across the US. The Industrial Parts Group, operating under the name Motion Industries, provides customized product and technical expertise to the manufacturing industry. The Office Products group distributes over 30,000 business products from 44 distribution centers across the U.S. and Canada under the name S.P. Richards Company. The Electrical/Electronic Materials Group was formed in 1998 through the acquisition of EIS, the nation's largest distributor of electronic and electrical apparatus. The group distributes over 100,000 items from 33 locations across the U.S. and Mexico.

Trends and Forces

Longer manufacturer warranties mean less business for DEI's clients

Longer manufacturer warranties have become the industry standard in recent years. These warranties, which offer free repairs, motivate car owners to do repairs at the dealership rather than through NAPA stores for the first few years of ownership. This in turn hurts GPC's business, as the repairs are offered for free.

Outsourcing of manufacturing erodes client base

Increased outsourcing of North American manufacturing will hurt GPC's bottom line as its subsidiaries lie entirely in the US, Canada and Mexico. A study conducted by "PERI" of the Univ. of Massachusetts found that "foreign sourced goods in total manufacture inputs, a significant indicator of the extent of outsourcing activity, rose from 12.4% to 22.1% in the manufacturing sector as a whole.

Competitors

As a conglomerate, GPC encounters different competitive pressures in the respective industries in which its subsidiaries operate. GPC's business structure allows it to leverage its core competencies as a distributor across its business interests. This also leads to cost savings in the sharing of back office and HR facilities.

  • Automotive Parts Distribution, these companies compete with Genuine Parts for individual car owners:
  1. Automobile Manufacturers and Car Dealerships
  2. AutoZone (AZO)
  3. Advance Auto Parts (AAP)
  • Industrial Parts Distribution, these companies compete with Genuine Parts for heavy machinery part distribution:
  1. Applied Information Tech.
  2. General Motors (GM)
  • Office Supplies, these companies compete with Genuine Parts for distrubition of office supplies to American businesses:
  1. Officemax (OMX)
  2. Office Depot (ODP)
  3. Staples (SPLS)
  • Electronic Supplies, these companies compete with Genuine Parts for distribution of Electronic components:
  1. Micron Technology (MU)
  2. Atmel (ATML)
  3. Advanced Micro Devices (AMD)

Footnotes

  1. GPC 10-K 2009 Item 6 Pg. 13
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