Fitch Ratings revised LKQ Corporation’s outlook to stable from positive while affirming its long-term issuer default rating at BBB-. The change reflects a slower deleveraging path as lower repairable collision claims pressure revenue and margins, while dividends and share buybacks absorb roughly half of operating cash flow after capital expenditures. Organic parts and services revenue fell 3.4% in the first half of 2026 after declining 2.7% in 2025, while Fitch-calculated EBITDA margins narrowed to 10.7% for the six months ended June 30 from 12.1% in full-year 2024. Leverage rose to 3.0x in the second quarter of 2026 from about 2.6x at year-end 2024, with a German enterprise resource planning implementation causing additional temporary disruption. Fitch expects leverage to fall to around 2.8x by the end of 2026 and 2.5x by 2028, above management’s internal 2.0x target. Despite the pressure, LKQ retains a resilient market position, particularly in North America, which generates roughly 40% of revenue. The segment posted 0.5% organic parts and services growth in the second quarter despite a 1% to 3% market decline in repairable claims. Fitch said disciplined working-capital management should support mid-single-digit free-cash-flow margins, with post-dividend free cash flow expected at $300 million to $450 million annually for bolt-on acquisitions without additional leverage.