Advance Auto Parts, Inc. (AAP - Free Report) recently announced that it purchased the DieHard car battery brand from Transform Holdco LLC, the parent company of Kmart and Sears, for a cash consideration of $200 million.
Following the acquisition, Advance Auto Parts will have the right to sell DieHard batteries and extend the DieHard brand to other automotive and vehicle categories.
Moreover, the acquisition of DieHard is expected to differentiate Advance Auto Parts, drive increased DIY customer traffic, create a unique value proposition for its expert customers and independent Carquest partners, and drive significant long-term shareholder value. It will also allow the company to build a leadership position in the critical battery category. Advance Auto Parts can also leverage the brand in other business categories such as marine and recreational vehicles.
Per the supply agreement, Transformco will still develop and sell DieHard batteries in its Sear stores. The deal also includes an exclusive royalty-free and perpetual license, which would give Transformco permission to develop, market and sell DieHard items outside automotive categories. Moreover, the deal offers Sears and Kmart with much-needed cash as it has been witnessing revenue decline and vanishing banner stores.
Shares of Advance Auto Parts have underperformed the industry it belongs to over the past year. Its shares have appreciated 3% compared with the industry’s growth of 30.1%.
The company anticipates consolidated revenues of $9,650-$9,750 million for 2019. Further, adjusted operating income margin is projected at 8-8.2% and capital expenditure is estimated at $250-$300 million.
Zacks Rank & Stocks to Consider
Currently, Advance Auto Parts has a Zacks Rank #3 (Hold).
A few better-ranked stocks in the Auto-Tires-Trucks sector are Weichai Power Co. , Spartan Motors, Inc and SPX Corporation (SPXC - Free Report) . While Weichai Power flaunts a Zacks Rank #1 (Strong Buy) at present, Spartan Motors and SPX carry a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Weichai Power has a projected earnings growth rate of 6.1% for the current year. Its shares have gained 80.3% over the past year.
Spartan Motors has an estimated earnings growth rate of 85.4% for the ongoing year. The company’s shares have surged 152.1% in a year.
SPX has an expected earnings growth rate of 23.6% for 2019. The company’s shares have surged 90.3% in the past year.
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Advance Auto Parts, Inc. (AAP - Free Report) recently announced that it purchased the DieHard car battery brand from Transform Holdco LLC, the parent company of Kmart and Sears, for a cash consideration of $200 million.
Following the acquisition, Advance Auto Parts will have the right to sell DieHard batteries and extend the DieHard brand to other automotive and vehicle categories.
Moreover, the acquisition of DieHard is expected to differentiate Advance Auto Parts, drive increased DIY customer traffic, create a unique value proposition for its expert customers and independent Carquest partners, and drive significant long-term shareholder value. It will also allow the company to build a leadership position in the critical battery category. Advance Auto Parts can also leverage the brand in other business categories such as marine and recreational vehicles.
Per the supply agreement, Transformco will still develop and sell DieHard batteries in its Sear stores. The deal also includes an exclusive royalty-free and perpetual license, which would give Transformco permission to develop, market and sell DieHard items outside automotive categories. Moreover, the deal offers Sears and Kmart with much-needed cash as it has been witnessing revenue decline and vanishing banner stores.
Shares of Advance Auto Parts have underperformed the industry it belongs to over the past year. Its shares have appreciated 3% compared with the industry’s growth of 30.1%.
The company anticipates consolidated revenues of $9,650-$9,750 million for 2019. Further, adjusted operating income margin is projected at 8-8.2% and capital expenditure is estimated at $250-$300 million.
Zacks Rank & Stocks to Consider
Currently, Advance Auto Parts has a Zacks Rank #3 (Hold).
A few better-ranked stocks in the Auto-Tires-Trucks sector are Weichai Power Co. , Spartan Motors, Inc and SPX Corporation (SPXC - Free Report) . While Weichai Power flaunts a Zacks Rank #1 (Strong Buy) at present, Spartan Motors and SPX carry a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Weichai Power has a projected earnings growth rate of 6.1% for the current year. Its shares have gained 80.3% over the past year.
Spartan Motors has an estimated earnings growth rate of 85.4% for the ongoing year. The company’s shares have surged 152.1% in a year.
SPX has an expected earnings growth rate of 23.6% for 2019. The company’s shares have surged 90.3% in the past year.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
See the pot trades we're targeting>>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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