AAP
Advance Auto Parts Inc.
Consumer, Industrial/Transportation
10/14/2014
Presented
| Date | 10/09/2014 |
| Price | $132.81 |
| Market Cap | $9.69B |
| Ent Value | $11.49B |
| P/E Ratio | 23.07x |
| Book Value | $27.44 |
| Div Yield | 0.2% |
| Shares O/S | 72.98M |
| Ave Daily Vol | 670,000 |
| Short Int | 2.56% |
Current
| Price | $39.47 |
| Market Cap | $2.36B |
| Advance Auto Parts, Inc., through its subsidiaries, operates as a specialty retailer of automotive aftermarket parts, accessories, batteries, and maintenance items. It operates in two segments, Advance Auto Parts (AAP) and Autopart International (AI). The APP segment operates stores that offer brand name and private label automotive products, including alternators, batteries, belts and hoses, brakes and brake pads, chassis parts, clutches, driveshafts, engines and engine parts, ignition parts, lighting, radiators, starters, spark plugs and wires, steering and alignment parts, transmissions, water pumps, and windshield wiper blades; accessories, such as air fresheners, anti-theft devices, emergency road kits, floor mats, ice scrapers, mirrors, vent shades, MP3 and cell phone accessories, and seat and steering wheel covers; chemicals comprising antifreeze, brake and power steering fluids, freon, fuel additives, windshield washer fluids, and car washes and waxes; and oils, transmission fluids, and other automotive petroleum products for domestic and imported cars and light trucks. This segment also provides battery and wiper installation, battery charging, check engine light reading, electrical system testing, video clinics, loaner tool programs, and oil and battery recycling services. In addition, it sells products online. The AI segment operates stores that offer replacement parts for domestic and imported cars and light trucks. It serves customers in the Northeastern, Mid-Atlantic, and Southeastern regions of the United States; and warehouse distributors and jobbers in North America. As of January 3, 2015, the company operated 5,261 stores and 111 Worldpac branches; and served approximately 1,325 independently-owned Carquest stores in the United States, Puerto Rico, the U.S. Virgin Islands, and Canada. It serves do-it-yourself, do-it-for-me, or commercial customers. The company was founded in 1929 and is headquartered in Roanoke, Virginia. |
Publicly traded companies mentioned herein: Advance Auto Parts Inc (AAP), AutoZone Inc (AZO), Genuine Parts Company (GPC), O'Reilly Automotive Inc. (ORLY)
Highlights
Commercial auto parts do it yourself (DIY) business represents ~60% of Advance Auto Parts’ (AAP) overall revenue, and the presenter believes the company’s acquisition of CARQUEST puts it in an excellent position to outperform Street and investor expectations. The deal addressed a material strategic issue AAP was faced with in competing for business against O’Reilly, and with better local distribution the company should be able to improve service and margins. If the presenter’s bullish view is correct, AAP shares could be worth as much as $190 in 12 months, and possibly $220+ longer-term.
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