Gavekal Capital: Is LKQ Corp's Run Finally Over?

Tuesday, January 21, 2014

Is LKQ Corp's Run Finally Over?

LKQ is up nearly 180% over the past four years for an impressive 100% greater gain than the MSCI World during that time. However, the stock has shown some distribution problems recently as it has underperformed the MSCI World index by nearly 20% over the past 3 moths (-15.8% nominal decline). That brings us to today, where LKQ is down another 7% so far. Is it reasonably to read this as a sign that the entire index is extended because prior stock leadership is now strongly underperforming? Time will tell.

About Gavekal Capital

Gavekal Capital is a US registered investment advisory firm that manages the Gavekal Knowledge Leaders Strategy. Knowledge Leaders are a group of the world’s leading innovators with deep reservoirs of intangible capital. These companies often possess competitive advantages such as strong brand, proprietary knowledge or a unique distribution mechanism. Knowledge Leaders are largely service-based and advanced manufacturing businesses, often operating globally. Gavekal Capital seeks to identify the world’s leading knowledge companies through a proprietary process that analyzes corporate knowledge investments.
We offer the Gavekal Knowledge Leaders Strategy in multiple products for global investors. For more information about our product offerings please visit http://www.gavekalcapital.com.
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