Advance Auto Parts, Inc. (AAP - Free Report) reported adjusted earnings of $1.89 per share in third-quarter 2018 (ended Oct 6, 2018), up from $1.43 in the prior-year quarter. The figure surpassed the Zacks Consensus Estimate of $1.77. Adjusted operating income increased 12.5% year over year to $193.7 million.
Advance Auto Parts reported net revenues of $2.3 billion, beating the Zacks Consensus Estimate of $2.23 billion. Revenues were 4.3% higher than the year-ago quarter. During the quarter under review, comparable store sales were 4.6% higher year over year. This marks strongest comparable sales growth in eight years for the company.
Gross profit was $1.01 billion in the reported quarter, higher than the prior-year quarter figure of $947.7 million. Gross Profit margin increased 90 basis points year over year to 44.3%.
Adjusted selling, general and administrative (SG&A) expenses totaled $813.8 million compared with $775.5 million in the year-ago period.
Advance Auto Parts had cash and cash equivalents of $970 million as of Oct 6, 2018, up from $363.3 million as of Oct 7, 2017. The total long-term debt was $1.05 billion as of Oct 6, 2018, higher than $1.04 billion as of Dec 30, 2017.
In third-quarter 2018, operating cash flow was $681.5 million compared with $401 million in the same period of 2017.
Dividend & Share Repurchase
On Nov 7, 2018, Advance Auto Parts’ board approved a cash dividend of 6 cents per share to be paid on Jan 4, 2019, for shareholders of record as of Dec 21, 2018.
On Aug 8, 2018, the board of directors authorized a $600-million share repurchase program, replacing the existing $500-million share repurchase program. In the third quarter, the company bought back 720 thousand shares for $119.9 million. At the end of third-quarter 2018, Advance Auto Parts had $480.1 million remaining under the share repurchase program.
As of Oct 6, 2018, Advance Auto Parts operated 4,981 stores and 139 Worldpac branches, and served approximately 1,229 independently-owned Carquest stores.
Zacks Rank & Other Stocks to Consider
Advance Auto Parts currently carries a Zacks Rank #2 (Buy). A few other top-ranked stocks in the auto space are Allison Transmission Holdings, Inc. (ALSN - Free Report) , Fox Factory Holding Corp. (FOXF - Free Report) and AutoZone, Inc. (AZO - Free Report) . While Allison Transmission and Fox Factory sport a Zacks Rank #1 (Strong Buy), AutoZone carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Allison Transmission has an expected long-term growth rate of 10%. Over the past six months, shares of the company have surged 10%.
Fox Factory has an expected long-term growth rate of 17.2%. Over the past six months, shares of the company have risen 84.6%.
AutoZone has an expected long-term growth rate of 12.2%. Over the past six months, shares of the company have risen 19%.
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