AAP - Embedded Expectations Analysis - 2020 06 30
Advance Auto Parts, Inc. (AAP:USA) currently trades above corporate averages relative to UAFRS-based (Uniform) earnings, with a 25.8x Uniform P/E. At these levels, the market has expectations for profitability to remain flat, and management may be concerned about their WMS implementation, e-commerce sales, and retail traffic reductionsSpecifically, management may lack confidence in their ability to implement their warehouse management system (WMS) in other distribution centers and sustain the significant uptick in e-commerce sales. In addition, they may have concerns about professional car count and DIY retail traffic reductions, the progress of their back office consolidation, and their safety initiatives. Furthermore, they may be overstating the potential of their technology platform to help drive sales going forward, and they may be concerned about store closures, weakness in cold weather categories, and decreases in adjusted gross profit
Advance Auto Parts is an automotive aftermarket parts provider in North America, serving both professional installers (Professional), and do-it-yourself (DIY), customers as well as independently owned operators. The company's stores and branches provide a range selection of brand name, original equipment manufacturer and private label automotive replacement parts, accessories, batteries and maintenance items for domestic and imported cars, vans, sport utility vehicles and light and heavy duty trucks. Through its integrated operating approach, the company serves its Professional and DIY customers through a variety of channels ranging from brick and mortar store locations to self-service e-commerce sites.
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