Advance Auto Parts Misses Where it Counts

Seth Jayson, The Motley Fool
Updated

Advance Auto Parts (NYS: AAP) reported earnings on Aug. 9. Here are the numbers you need to know.

The 10-second takeaway
 For the quarter ended July 14 (Q2), Advance Auto Parts met expectations on revenues and missed estimates on earnings per share.

Compared to the prior-year quarter, revenue dropped slightly and GAAP earnings per share contracted.


Gross margins expanded, operating margins dropped, net margins contracted.

Revenue details
 Advance Auto Parts logged revenue of $1.46 billion. The 17 analysts polled by S&P Capital IQ expected revenue of $1.48 billion on the same basis. GAAP reported sales were 1.3% lower than the prior-year quarter's $1.48 billion.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
 EPS came in at $1.34. The 20 earnings estimates compiled by S&P Capital IQ predicted $1.40 per share. GAAP EPS of $1.34 for Q2 were 8.2% lower than the prior-year quarter's $1.46 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
 For the quarter, gross margin was 49.9%, 20 basis points better than the prior-year quarter. Operating margin was 11.6%, 120 basis points worse than the prior-year quarter. Net margin was 6.8%, 80 basis points worse than the prior-year quarter.

Looking ahead
 Next quarter's average estimate for revenue is $1.48 billion. On the bottom line, the average EPS estimate is $1.35.

Next year's average estimate for revenue is $6.28 billion. The average EPS estimate is $5.34.

Investor sentiment
 The stock has a three-star rating (out of five) at Motley Fool CAPS, with 239 members out of 263 rating the stock outperform, and 24 members rating it underperform. Among 78 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 71 give Advance Auto Parts a green thumbs-up, and seven give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Advance Auto Parts is hold, with an average price target of $82.06.

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The article Advance Auto Parts Misses Where it Counts originally appeared on Fool.com.

Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool has no positions in the stocks mentioned above. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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