Advance Auto Parts (NYSE:AAP) Shares Gap Down - Here's Why

Key Points

• Advance Auto Parts shares plunged, opening at $46.85 versus the prior close of $56.18, after quarterly revenue and comparable-store sales fell short of expectations.
• Despite weaker sales, adjusted EPS rose to $1.03 from $0.69 a year earlier and exceeded the $0.81 consensus, while gross profit and operating income improved significantly. The company also reduced debt by approximately $30 million, lowering net leverage to 2.1 times.
• Management maintained full-year revenue guidance of $8.485 billion to $8.575 billion and EPS guidance of $2.60 to $3.30. Analysts remain largely cautious, with a consensus “Hold” rating and a $58.91 price target.

Advance Auto Parts, Inc. (NYSE:AAP - Get Free Report)'s stock price gapped down before the market opened on Thursday . The stock had previously closed at $56.18, but opened at $46.85. Advance Auto Parts shares last traded at $44.6780, with a volume of 2,118,922 shares traded.

Key Advance Auto Parts News

Here are the key news stories impacting Advance Auto Parts this week:

• Positive Sentiment: Adjusted earnings were $1.03 per share, above the $0.81 analyst consensus and up from $0.69 a year earlier. Gross profit improved to $923 million, or 46.2% of sales, from 43.5% last year, while operating income rose to $101 million from $22 million. Advance Auto Parts Q2 Earnings Surpass Estimates
• Positive Sentiment: Advance Auto Parts reduced approximately $30 million of debt during the quarter, bringing net leverage down to 2.1 times from 2.4 times in the first quarter, which supports its balance-sheet improvement efforts. Advance Auto Parts Reports Second-Quarter Profit
• Neutral Sentiment: Management maintained full-year revenue guidance of approximately $8.485 billion to $8.575 billion, broadly in line with expectations. Full-year EPS guidance of $2.60 to $3.30 brackets the $2.94 consensus, leaving investors focused on where results land within the wide range. Advance Auto Parts Reports Second-Quarter 2026 Results
• Negative Sentiment: Comparable-store sales fell 0.5% and quarterly revenue of roughly $2.0 billion missed the $2.04 billion consensus. Reports attributed the sales pressure to constrained consumer spending, raising concerns about demand growth and the durability of the earnings improvement. Advance Auto Parts Stock After Earnings

Analyst Upgrades and Downgrades

A number of brokerages have recently commented on AAP. Citigroup decreased their price target on shares of Advance Auto Parts from $60.00 to $57.00 and set a "neutral" rating for the company in a research note on Thursday, August 13th. The Goldman Sachs Group increased their price target on Advance Auto Parts from $49.00 to $54.00 and gave the stock a "sell" rating in a research report on Friday, May 22nd. JPMorgan Chase & Co. cut their price target on Advance Auto Parts from $64.00 to $59.00 and set a "neutral" rating on the stock in a research note on Friday, May 15th. Truist Financial upped their price objective on shares of Advance Auto Parts from $55.00 to $62.00 and gave the stock a "hold" rating in a research note on Thursday, May 21st. Finally, TD Cowen reiterated a "hold" rating on shares of Advance Auto Parts in a report on Friday, May 22nd. Two investment analysts have rated the stock with a Buy rating, seventeen have assigned a Hold rating and one has given a Sell rating to the company's stock. According to data from MarketBeat, Advance Auto Parts currently has a consensus rating of "Hold" and a consensus price target of $58.91.

Advance Auto Parts Price Performance

The firm has a 50-day simple moving average of $57.30 and a 200-day simple moving average of $55.47. The firm has a market cap of $2.62 billion, a P/E ratio of 60.22, a PEG ratio of 0.94 and a beta of 1.03. The company has a current ratio of 1.78, a quick ratio of 0.85 and a debt-to-equity ratio of 1.54.

Advance Auto Parts (NYSE:AAP - Get Free Report) last released its quarterly earnings results on Thursday, August 20th. The company reported $1.03 EPS for the quarter, topping the consensus estimate of $0.81 by $0.22. Advance Auto Parts had a return on equity of 8.95% and a net margin of 0.51%.The firm had revenue of $2 billion during the quarter, compared to analyst estimates of $2.04 billion. During the same period in the previous year, the company posted $0.69 EPS. The business's revenue for the quarter was down .5% compared to the same quarter last year. Advance Auto Parts has set its FY 2026 guidance at 2.600-3.300 EPS. As a group, analysts forecast that Advance Auto Parts, Inc. will post 2.94 EPS for the current year.

Institutional Trading of Advance Auto Parts

A number of institutional investors have recently modified their holdings of AAP. Quantitative Investment Management LLC grew its position in shares of Advance Auto Parts by 16.6% in the 2nd quarter. Quantitative Investment Management LLC now owns 13,300 shares of the company's stock worth $827,000 after buying an additional 1,891 shares during the last quarter. Two Sigma Securities LLC acquired a new stake in Advance Auto Parts in the second quarter valued at approximately $567,000. Hsbc Holdings PLC boosted its stake in Advance Auto Parts by 4.7% in the second quarter. Hsbc Holdings PLC now owns 7,879 shares of the company's stock valued at $490,000 after acquiring an additional 355 shares in the last quarter. Empowered Funds LLC purchased a new position in Advance Auto Parts in the second quarter worth $3,527,000. Finally, Corient Private Wealth LP purchased a new position in Advance Auto Parts in the second quarter worth $529,000. 88.70% of the stock is currently owned by institutional investors.

About Advance Auto Parts

Advance Auto Parts, Inc NYSE: AAP is a leading distributor of automotive aftermarket parts, accessories, and maintenance items. The company operates a network of stores and distribution centers across North America, serving both do-it-yourself (DIY) customers and professional service providers. Advance Auto Parts focuses on offering a comprehensive selection of replacement parts, batteries, engine components, and performance products for cars and light trucks.

The company's product portfolio includes engine oils and lubricants, cooling system components, brake and suspension parts, filters, belts, hoses, and diagnostic tools.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.

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