#3 - Advance Auto Parts (NYSE:AAP)
The auto parts market has been a model of investor sentiment since the onset of the pandemic. First, most stocks, including Advance Auto Parts (NYSE: AAP) moved steadily higher as consumers continued to work on their cars during the pandemic. Then AAP stock moved sharply higher in 2021 as the economy reopened, and soaring auto prices meant consumers needed to keep their existing rides in tip-top condition.
But 2022 was a different story. Some of it is due to a return of electric vehicle (EV) mania. AAP stock was down 35% for the year. The question for investors in 2023 is, what comes now? Analysts believe the stock has an upside of about 24%. If that’s true, it will need to solve the margin problems evident in its most recent earnings report.
The company missed badly on earnings in its last quarter after the first two quarters also showed flat earnings. Revenue growth is flattening as well. The company believes it can increase its revenue per customer, particularly because it generates a significant portion of revenue through its professional base.
Advance Auto Parts is guiding to earnings per share in a range of $12.60 to $13.55. That’s below the average analysts’ estimate of $14.83.
About Advance Auto Parts
Advance Auto Parts, Inc provides automotive replacement parts, accessories, batteries, and maintenance items for domestic and imported cars, vans, sport utility vehicles, and light and heavy duty trucks. The company offers battery accessories; belts and hoses; brakes and brake pads; chassis and climate control parts; clutches and drive shafts; engines and engine parts; exhaust systems and parts; hub assemblies; ignition components and wires; radiators and cooling parts; starters and alternators; and steering and alignment parts.
Read More - Current Price
- $73.95
- Consensus Rating
- Reduce
- Ratings Breakdown
- 1 Buy Ratings, 16 Hold Ratings, 2 Sell Ratings.
- Consensus Price Target
- $64.56 (12.7% Downside)
