Top Performer for Thurs: Advance Auto Parts (AAP)

You know it's a tough day on the market when a gain of approximately 1% is enough to make the Zacks #1 Rank Top Performers List. But, such is the case for Advance Auto Parts, Inc. (AAP - Analyst Report) as we head into the Fourth of July weekend.

By now, most readers know that auto parts companies are getting a boost from these tough times, as drivers are opting to repair existing cars rather than buy new ones. Earnings estimates for AAP remain well above levels from 60 days ago, and the company has put together several quarters of better-than-expected profit results.

AAP is moving today on lower-than-normal volume of about 877,000 shares, compared to the daily average of more than 1.6 million. The only other company from the retail/wholesale - auto parts industry on today's Zacks #1 Rank List is AutoZone, Inc. (AZO - Analyst Report). (The list includes 224 stocks today.)

Strong First Quarter

In late May, AAP announced that first-quarter sales reached $1.68 billion, or 10.3% better than the year-ago performance of $1.53 billion. This gain was attributed to adding 114 stores in the previous 12 months, as well as same-store sales growth of 8.2%.

Excluding items, earnings reached $1.02 per share, which topped the consensus by 12 cents, or more than 13%. In the year-ago quarter, AAP earned 86 cents.

The company remains confident in its strategic initiatives, and will continue to accelerate its rate of investment in order to strengthen its core strategic capabilities.

Estimates Remain High

Profit expectations haven't moved in the past month, but remain well above levels from 2 months ago. In fact, earnings estimates for this year and next are each 16 cents better than levels from 60 days ago, accounting for gains of 5.7% and 5.2%, respectively.

Analysts currently expect $3.26 for next year, which is more than 10% atop this year's estimate of $2.96.

For its second quarter, earnings are currently pegged at 83 cents, up 6.4% from 2 months ago. The company will report this quarter's results in mid August.