Topic: Growth Stocks

Wall Street Stock Forecaster Hotline – Friday, September 30, 2011

Article Excerpt

GENUINE PARTS CO., $50.80, New York symbol GPC, distributes auto parts to over 5,700 independent stores in North America. The company also operates about 1,000 auto parts stores under the NAPA banner. Auto parts account for roughly 50% of its sales. It gets the other 50% by distributing industrial parts, office furniture and electrical equipment. This week, the company agreed to buy 30% of privately held Exego Group, which distributes auto parts through 430 company-owned stores in Australia and New Zealand. The deal closes on December 1, 2011. Genuine will pay $150 million for this stake. That’s a little less than the $151.8 million, or $0.96 a share, that Genuine earned in the three months ended June 30, 2011. Genuine Parts has an option to buy the remaining 70% of Exego, provided Exego reaches certain earnings targets. This is Genuine Parts’ first major purchase outside of North America. However, teaming up with an established company like Exego cuts the risk…