Advance Auto Parts (AAP – Analyst Report) operates in the U.S. automotive aftermarket industry and is primarily engaged in selling replacement parts (excluding tires), accessories, batteries and maintenance items for domestic and imported vehicles. It is the largest automotive parts provider in North America. The company enhances profits through its relentless focus on store expansion. The rise in store count ensures higher availability of parts to customers, thereby leading to higher sales volume. Also, Advance Auto Parts is poised to benefit as the industry continues to show stability with the increasing average age of vehicles, along with a rise in the number of miles driven.
However, price competition remains a threat for Advance Auto Parts, as it competes with national and regional automotive retailers. Moreover, the improvement in the quality of new vehicles leads to reduced need for the maintenance and repair of parts. This, in turn, hampers demand in the automotive maintenance market.
Estimate Trend & Surprise History
Investors should note that the first-quarter earnings estimate for Advance Auto Parts has decreased by a penny to $2.50 over the past 30 days.
The company has delivered a flurry of positive earnings surprises. It has beaten the Zacks Consensus Estimate in all the trailing 4 quarters with an average beat of around 3.19%. Thus, investors have been eagerly awaiting Advance Auto Parts latest earnings report.
We have highlighted some of the key stats from this just-revealed announcement below:
Earnings
Advance Auto Parts delivered adjusted earnings of $2.39 per share in the first quarter of 2015, 6.2% higher year over year but missed the Zacks Consensus Estimate of $2.50.
Revenues
Advance Auto Parts reported revenues of $3.04 billion, up 2.3% year over year. Revenues marginally missed the Zacks Consensus Estimate of $3.06 billion.
Key Stats/Developments to Note
During the 16-week period ended Apr 25, 2015, Advance Auto Parts opened 25 stores and closed 7. Also, the company also consolidated 40 stores. As of Apr 25, 2015, the company’s total store count stood at 5,350.
