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Why Is Advance Auto Parts (AAP) Up 9.3% Since Last Earnings Report?
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A month has gone by since the last earnings report for Advance Auto Parts (AAP - Free Report) . Shares have added about 9.3% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Advance Auto Parts due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Advance Auto Parts’ Q1 Earnings Top, '21 View Up
Advance Auto Parts reported adjusted earnings of $3.34 per share for first-quarter 2021 (ended Apr 24, 2021), skyrocketing 234% from the prior-year figure. The reported figure also beat Zacks Consensus Estimate of $3.08 on higher-than-expected comps growth. For the first quarter, comparable store sales increased 24.7%, outpacing the consensus mark of 13.33% growth.
Advance Auto Parts generated net revenues of $3,330.4 million, topping the Zacks Consensus Estimate of $3,314.4 million. Moreover, the revenue figure increased 23.4% from the year-ago reported figure.
Adjusted operating income climbed 164% year over year to $298.8 million. Adjusted selling, general and administrative expenses totaled $1,232.8 million compared with $1,094.3 million witnessed in the year-ago quarter.
Financial Position
Advance Auto Parts had cash and cash equivalents of $880.2 million as of Apr 24, 2021 compared with $834.9 million as of Jan 2, 2021. Total long-term debt was $1,033 million as of Apr 24, 2021, essentially unchanged from the fourth quarter.
Operating cash flow jumped to $329.9 million from the year-ago figure of $10.9 million. Free cash flow (FCF) came in at $259 million versus the year-ago negative FCF of $72.1 million.
Dividend & Share Repurchase
In April, Advance Auto Parts’ board approved a cash dividend of $1 per share, indicating a significant uptick from 25 cents. The dividend would be payable on Jul 2 to all common shareholders of record as of Jun 18, 2021. It also approved an additional buyback program of $1 billion. During the quarter, the company repurchased around 1.1 million shares for $170.4 million at an average price of $157.84 per share.
Advance Auto Parts returned $204 million to shareholders through buybacks and dividend in the quarter under review. At the end of first-quarter 2021, the company had $1.3 billion remaining under the share-repurchase program.
Store Update
As of Apr 24, it operated 4,971 stores and 178 Worldpac branches in the United States, Canada, Puerto Rico and U.S. Virgin Islands. It also serves 1,285 independently-owned Carquest-branded stores across these locations, in addition to Mexico, the Bahamas, Grand Cayman, Turks and Caicos, and British Virgin Islands.
Guidance for 2021
Advance Auto Parts raised full-year 2021 view. It now projects full-year 2021 net sales of $10.4-$10.6 billion, up from previous forecast of $10.2-$10.4 billion. Comparable store sales growth and adjusted operating income margin are now envisioned in the band of 4-6% and 9-9.2%, respectively. The company expects FCF of minimum $575 million. It intends to open 100-150 stores this year.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in fresh estimates.
VGM Scores
Currently, Advance Auto Parts has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Advance Auto Parts has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
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Why Is Advance Auto Parts (AAP) Up 9.3% Since Last Earnings Report?
A month has gone by since the last earnings report for Advance Auto Parts (AAP - Free Report) . Shares have added about 9.3% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Advance Auto Parts due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Advance Auto Parts’ Q1 Earnings Top, '21 View Up
Advance Auto Parts reported adjusted earnings of $3.34 per share for first-quarter 2021 (ended Apr 24, 2021), skyrocketing 234% from the prior-year figure. The reported figure also beat Zacks Consensus Estimate of $3.08 on higher-than-expected comps growth. For the first quarter, comparable store sales increased 24.7%, outpacing the consensus mark of 13.33% growth.
Advance Auto Parts generated net revenues of $3,330.4 million, topping the Zacks Consensus Estimate of $3,314.4 million. Moreover, the revenue figure increased 23.4% from the year-ago reported figure.
Adjusted operating income climbed 164% year over year to $298.8 million. Adjusted selling, general and administrative expenses totaled $1,232.8 million compared with $1,094.3 million witnessed in the year-ago quarter.
Financial Position
Advance Auto Parts had cash and cash equivalents of $880.2 million as of Apr 24, 2021 compared with $834.9 million as of Jan 2, 2021. Total long-term debt was $1,033 million as of Apr 24, 2021, essentially unchanged from the fourth quarter.
Operating cash flow jumped to $329.9 million from the year-ago figure of $10.9 million. Free cash flow (FCF) came in at $259 million versus the year-ago negative FCF of $72.1 million.
Dividend & Share Repurchase
In April, Advance Auto Parts’ board approved a cash dividend of $1 per share, indicating a significant uptick from 25 cents. The dividend would be payable on Jul 2 to all common shareholders of record as of Jun 18, 2021. It also approved an additional buyback program of $1 billion. During the quarter, the company repurchased around 1.1 million shares for $170.4 million at an average price of $157.84 per share.
Advance Auto Parts returned $204 million to shareholders through buybacks and dividend in the quarter under review. At the end of first-quarter 2021, the company had $1.3 billion remaining under the share-repurchase program.
Store Update
As of Apr 24, it operated 4,971 stores and 178 Worldpac branches in the United States, Canada, Puerto Rico and U.S. Virgin Islands. It also serves 1,285 independently-owned Carquest-branded stores across these locations, in addition to Mexico, the Bahamas, Grand Cayman, Turks and Caicos, and British Virgin Islands.
Guidance for 2021
Advance Auto Parts raised full-year 2021 view. It now projects full-year 2021 net sales of $10.4-$10.6 billion, up from previous forecast of $10.2-$10.4 billion. Comparable store sales growth and adjusted operating income margin are now envisioned in the band of 4-6% and 9-9.2%, respectively. The company expects FCF of minimum $575 million. It intends to open 100-150 stores this year.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in fresh estimates.
VGM Scores
Currently, Advance Auto Parts has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Advance Auto Parts has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.