Shares of Genuine Parts (NYSE: GPC) were falling today after the Napa Auto Parts parent posted disappointing results in its third-quarter earnings report.

While the company beat top-line estimates, it fell woefully short on the bottom line. As of 1 p.m. ET, the stock was down 19% on the news.

Genuine Parts hits the brakes

In the quarter reported Tuesday, overall revenue rose 2.5% to $5.97 billion, though it would have declined slightly without the benefit of an acquisition and an extra selling day in the U.S. That result beat estimates of $5.94 billion.

Sales in its core automotive segment were up 4.8% to $3.8 billion, while industrial sales fell 1.2% to $2.2 billion.

Profits fell in the quarter as the company cited weakness in Europe and the industrial segment. Adjusted earnings per share slipped from $2.49 to $1.88, but that was well below the consensus estimate of $2.42

CEO Will Stengel said results were below the company’s expectations, adding, “While the external environment remains challenging for the balance of 2024, we expect the combination of near-term actions and long-term investments to better position us when market conditions improve.”

What’s next for Genuine Parts

Looking ahead, Genuine Parts cut its earnings-per-share guidance from $9.30-$9.50 to $8.00-$8.20. It also lowered its revenue growth guidance from 1%-3% to 1%-2%.

Challenges in the industrial segment seem to be what are causing the Napa parent to underperform AutoZone and O’Reilly Automotive this year.

Those two companies have been consistent winners in the sector, and investors in the auto parts industry are probably better off with one of those stocks rather than Genuine Parts, at least until the company can return to profit growth.

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Jeremy Bowman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.