The last 12 months have been tough for Bapcor (ASX:BAP) but there now appears to be light at the end of the tunnel. After a challenging period for Bapcor shares, we saw the recent full-year results release (FY19) as potentially a turning point.
Bapcor is Australia’s biggest supplier of parts to the car repair trade is travelling nicely at the moment - earnings for the year to June jumped more than 50%, dividend was boosted and the company is looking for another year to double digital growth in 2018-19.
The company has recently reiterated net profit growth guidance for FY19 of 9% and will host an investor briefing on July 3. Morgans assesses the company is capable of sustaining a solid single-digit organic growth profile across the forecast years.
The company will acquire five businesses that specialise in the sale and distribution of Japanese truck parts. UBS observes this will strengthen its position in supplying parts to small and medium-size commercial vans and trucks that are experiencing strong growth in demand from the rise of online retail deliveries.
The investor briefing reiterated guidance and ANA synergy targets, with the company planning to change its name to Bapcor. UBS finds the cost synergies much higher than previously expected and coming earlier.