Advance Auto Parts (NYSE:AAP) Issues Quarterly Earnings Results

Advance Auto Parts (NYSE:AAP) announced its quarterly earnings results on Thursday. The company reported $0.77 EPS for the quarter, topping the consensus estimate of $0.39 by $0.38, FiscalAI reports. The company had revenue of $2.61 billion during the quarter, compared to analyst estimates of $2.05 billion. Advance Auto Parts had a return on equity of 8.95% and a net margin of 0.51%.The firm’s revenue was up 1.2% on a year-over-year basis. During the same period in the prior year, the firm posted $0.40 earnings per share. Advance Auto Parts updated its FY 2026 guidance to 2.400-3.100 EPS.

Here are the key takeaways from Advance Auto Parts’ conference call:

• Advance Auto Parts reported 3.5% comparable sales growth, its strongest quarterly comp in five years, driven by solid performance in both Pro and DIY channels.
• Adjusted operating margin expanded over 400 basis points to 3.8% as merchandising improvements, product margin expansion, and expense leverage all helped profitability.
• The company said its Main Street Pro strategy is outperforming, with better assortment, service levels, and availability supporting continued share gains in a larger, higher-margin addressable market.
• Management highlighted early success from new initiatives including the ARGOS owned oil brand and the modernized Advance Rewards loyalty program, both of which are seeing strong customer engagement.
• Advance reaffirmed full-year guidance, targeting $8.5 billion in sales, 1%-2% comparable sales growth, and adjusted operating margin of 3.8%-4.5%, while noting potential near-term demand variability from pressured consumers and higher gas prices.

Advance Auto Parts Price Performance

AAP stock opened at $57.63 on Friday. The company has a debt-to-equity ratio of 1.54, a quick ratio of 0.87 and a current ratio of 1.78. Advance Auto Parts has a 1 year low of $37.89 and a 1 year high of $70.00. The firm has a market cap of $3.48 billion, a P/E ratio of 80.04, a price-to-earnings-growth ratio of 1.03 and a beta of 1.06. The stock has a 50-day simple moving average of $53.93 and a 200-day simple moving average of $50.42.

Advance Auto Parts Dividend Announcement

The business also recently announced a quarterly dividend, which will be paid on Friday, July 24th. Stockholders of record on Friday, July 10th will be paid a $0.25 dividend. The ex-dividend date is Friday, July 10th. This represents a $1.00 dividend on an annualized basis and a dividend yield of 1.7%. Advance Auto Parts’s dividend payout ratio (DPR) is 136.99%.

Analysts Set New Price Targets

Several equities research analysts have commented on AAP shares. Wells Fargo & Company upped their price target on Advance Auto Parts from $50.00 to $60.00 and gave the stock an “equal weight” rating in a research note on Friday. BMO Capital Markets upped their price target on Advance Auto Parts from $60.00 to $65.00 and gave the stock a “market perform” rating in a research note on Friday. Morgan Stanley upped their price target on Advance Auto Parts from $60.00 to $65.00 and gave the stock an “equal weight” rating in a research note on Friday. Roth Mkm restated a “neutral” rating and set a $57.00 price target on shares of Advance Auto Parts in a research note on Thursday, February 19th. Finally, Evercore set a $60.00 price target on Advance Auto Parts in a research note on Wednesday, February 11th. Two equities research analysts have rated the stock with a Buy rating, eighteen have given a Hold rating and two have given a Sell rating to the company’s stock. According to data from MarketBeat.com, the company presently has an average rating of “Hold” and an average target price of $57.15.

Institutional Investors Weigh In On Advance Auto Parts

A number of large investors have recently modified their holdings of AAP. T. Rowe Price Investment Management Inc. boosted its holdings in Advance Auto Parts by 10.6% in the fourth quarter. T. Rowe Price Investment Management Inc. now owns 723,677 shares of the company’s stock valued at $28,441,000 after purchasing an additional 69,476 shares during the last quarter. XTX Topco Ltd purchased a new position in Advance Auto Parts in the fourth quarter valued at about $481,000. Wellington Management Group LLP boosted its holdings in Advance Auto Parts by 52.4% in the fourth quarter. Wellington Management Group LLP now owns 834,413 shares of the company’s stock valued at $32,792,000 after purchasing an additional 287,013 shares during the last quarter. SummitTX Capital L.P. boosted its holdings in Advance Auto Parts by 445.4% in the fourth quarter. SummitTX Capital L.P. now owns 41,717 shares of the company’s stock valued at $1,639,000 after purchasing an additional 34,068 shares during the last quarter. Finally, Prana Capital Management LP purchased a new position in Advance Auto Parts in the fourth quarter valued at about $510,000. Institutional investors and hedge funds own 88.70% of the company’s stock.

Advance Auto Parts News Summary

Here are the key news stories impacting Advance Auto Parts this week:

• Positive Sentiment: Advance Auto Parts posted Q1 EPS of $0.77 versus $0.39 expected and revenue of $2.61 billion versus $2.57 billion expected, signaling a solid earnings beat. Advance Auto Parts Reports First Quarter 2026 Results; Reaffirms Full Year 2026 Guidance
• Positive Sentiment: Comparable store sales rose 3.5%, driven by strength in the Pro business and improving DIY demand, while gross margin and operating margin expanded sharply, supporting the recovery narrative. Advance Auto Parts Gets Sales Boost From Pro Business
• Positive Sentiment: Several firms lifted price targets after the results, including Morgan Stanley, UBS, RBC, BMO Capital Markets, and Citigroup, reflecting improved sentiment around AAP’s recovery path. Advance Auto Parts Analysts Raise Their Forecasts Following Better-Than-Expected Q1 Results
• Neutral Sentiment: Management reaffirmed full-year 2026 guidance rather than raising it, which may temper enthusiasm even after the strong quarter. Advance Auto Q1 Earnings Beat Estimates on Strong Comps Growth
• Neutral Sentiment: Shareholders approved directors and governance matters at the annual meeting, a routine corporate update with limited immediate stock impact. Advance Auto Parts Shareholders Approve Directors and Governance Matters

About Advance Auto Parts

Advance Auto Parts, Inc (NYSE: AAP) is a leading distributor of automotive aftermarket parts, accessories, and maintenance items. The company operates a network of stores and distribution centers across North America, serving both do-it-yourself (DIY) customers and professional service providers. Advance Auto Parts focuses on offering a comprehensive selection of replacement parts, batteries, engine components, and performance products for cars and light trucks.

The company’s product portfolio includes engine oils and lubricants, cooling system components, brake and suspension parts, filters, belts, hoses, and diagnostic tools.