Thompson, Siegel, & Walmsley Adds Another $31 Million to its 2nd-Largest Holding, LKQ

Thompson, Siegel & Walmsley disclosed a material buy in LKQ, adding 1,470,033 shares (about $31.47m) in Q3 to bring its holding to 3,544,970 shares worth $108.26m as of Sept. 30, 2025, making LKQ the firm’s second-largest 13F position at roughly 1.75% of AUM. LKQ traded at $28.65 on Dec. 8, 2025 (down 26% Y/Y), with a $7.33bn market cap, TTM revenue of $13.96bn and net income of $697m; TSW has steadily increased exposure over two years, signaling a value/buy-the-dip thesis. With an EV/EBITDA around 7.8 and a 4.2% dividend yield, TSW’s move reflects conviction in LKQ’s distribution franchise and potential mean reversion, although the stock remains exposed to longer-term structural risks from EV and autonomous vehicle trends.

Analysis

Thompson, Siegel & Walmsley disclosed on Nov. 12, 2025 that it increased its LKQ position by 1,470,033 shares (about $31.47 million), lifting the stake to 3,544,970 shares valued at $108.26 million as of Sept. 30, 2025 and making LKQ roughly 1.75% of the fund's 13F-reportable AUM and the firm's second-largest holding. LKQ traded at $28.65 on Dec. 8, 2025, down 26% year-over-year and trailing the S&P 500 by ~39 percentage points, while the company reports TTM revenue of $13.96 billion, net income of $697 million and a market capitalization of $7.33 billion. Valuation and income metrics show an EV/EBITDA near 7.8 and a 4.2% dividend yield, metrics consistent with a value/buy-the-dip thesis given repeated accumulation by TSW (six additions over two years). The case reflects conviction in LKQ's distribution scale and aftermarket franchise but also highlights structural risk from EV/autonomy that could compress long-term parts demand, so performance will hinge on margin resilience, market-share maintenance across regions, and execution against secular change.

Key Decisions for Investors

• Consider a selective, size-constrained accumulation given TSW's conviction and attractive EV/EBITDA and dividend yield, but limit exposure since the stock has declined 26% Y/Y and faces structural EV-related risk
• Monitor quarterly indicators closely — organic parts volume, gross-margin trends, European vs. North American sales mix, and any guidance changes — and treat positive inflection as a signal to add while negative signs should prompt re-evaluation
• Use position sizing or hedges to protect against further downside from secular shifts in vehicle architecture and consider rebalancing if LKQ rises materially without commensurate operational improvement