When Advance Auto Parts Inc. (NYSE: AAP) reported its third-quarter financial results before the markets opened on Tuesday, they were mixed. Yet, it seems that this auto parts chain might be making a comeback after a disastrous year so far.
Before Tuesday’s move, shares had been cut in half year to date. While this has been a gradual slide, it hasn’t helped that Amazon is breaking into this industry as well.
The auto parts retailer posted $1.43 in earnings per share (EPS) and $2.18 billion in revenue, compared with consensus estimates from Thomson Reuters of $1.21 in EPS on revenue of $2.21 billion. The same period of last year reportedly had EPS of $1.73 and $2.24.
During the quarter, comparable store sales fell 3.4% year over year, which is down even further from a decline of 1% in the third quarter of last year.
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In terms of the outlook for the 2017 full year, the company expects to see comparable store sales down 3% to 1% and its adjusted operating income rate dropping by 200 to 300 basis points from last year. The consensus estimates are $5.10 in EPS and $9.4 billion in revenue for the full year.
On the books, Advance Auto Parts cash and cash equivalents totaled $363.3 million at the end of the quarter, up from $135.18 million at the end of the previous fiscal year.
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Tom Greco, president and CEO, commented:
We continue to take steps to build the foundation for future growth. We executed key transformational initiatives, including a complete restructure of our field operations and professional sales leadership teams. This important step in our journey sets us up well for the future. In the third quarter, we delivered improvements in cost initiatives while positioning the business for future success. We remain on track to deliver our 2017 guidance.
Shares of Advance Auto Parts were up about 19% at $97.80, with a consensus analyst price target of $104.61 and a 52-week range of $78.81 to $177.83.
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