Company Reports

We will discontinue analyst coverage of Advance Auto Parts on or about April 20.

For the better part of the past 15 years, Advance Auto Parts has grappled with bloated expenses and supply chain inefficiencies that continue to plague its cost structure and product availability. The company’s first two attempts at a strategic turnaround failed to materialize under past CEOs Darren Jackson (2008-15) and Tom Greco (2016-23). In 2023, the firm called upon Shane O’Kelly to lead another turnaround.

Advance Auto Parts posted 1.1% comparable sales growth in 2025's final quarter. Against an easy comparison due to large restructuring charges in 2024's fourth quarter, Advance's adjusted operating margin reached 3.7% on improved product margins driven by sourcing optimization and expense cuts.

For the better part of the past 15 years, Advance Auto Parts has grappled with bloated expenses and supply chain inefficiencies that continue to plague its cost structure and product availability. The company’s first two attempts at a strategic turnaround failed to materialize under past CEOs Darren Jackson (2008-15) and Tom Greco (2016-23). In 2023, the firm called upon Shane O’Kelly to lead another turnaround.

Advance Auto Parts posted 3% third-quarter comparable sales growth despite some softness on the consumer side due to tariff-related inflation. Advance's adjusted gross and operating margins rose about 260 and 370 basis points, respectively, to 44.8% and 4.4%.

For the better part of the past 15 years, Advance Auto Parts has grappled with bloated expenses and supply chain inefficiencies that continue to plague its cost structure and product availability. The company’s first two attempts at a strategic turnaround failed to materialize under past CEOs Darren Jackson (2008-15) and Tom Greco (2016-23). In 2023, the firm called upon Shane O’Kelly to lead another turnaround.

Advance Auto Parts' final second-quarter results align with its July 24 preliminary report. The firm posted 0.1% comparable sales growth, a 43.6% adjusted gross margin (up 20 basis points year over year), and a 3% adjusted operating margin (also up 20 basis points).

Advance Auto Parts announced preliminary second-quarter results of flat to 0.1% sales growth and an adjusted operating margin of 2.8%-3.0%. Also, the firm is issuing $1.5 billion in notes in two tranches that mature in 2030 and 2033 to, in part, retire $300 million in debt that matures in 2026.

For the better part of the past 15 years, Advance Auto Parts has grappled with bloated expenses and supply chain inefficiencies that continue to plague its cost structure and product availability. The company’s first two attempts at a strategic turnaround failed to materialize under past CEOs Darren Jackson (2008-15) and Tom Greco (2016-23). In 2023, the firm called upon Shane O’Kelly to lead another turnaround.

For the better part of the past 15 years, Advance Auto Parts has grappled with bloated expenses and supply chain inefficiencies that continue to plague its cost structure and product availability. The company’s first two attempts at a strategic turnaround failed to materialize under past CEOs Darren Jackson (2008-15) and Tom Greco (2016-23). In 2023, the firm called upon Shane O’Kelly to lead another turnaround.

For the better part of the past 15 years, Advance Auto Parts has grappled with bloated expenses and supply chain inefficiencies that continue to plague its cost structure and product availability. The company’s first two attempts at a strategic turnaround failed to materialize under past CEOs Darren Jackson (2008-15) and Tom Greco (2016-23). In 2023, the firm called upon Shane O’Kelly to lead another turnaround.

Advance Auto Parts posted a 0.6% decline in comparable sales in the first quarter as modest growth in the pro channel was offset by weak demand in do-it-yourself. The firm also swung to an adjusted operating loss of $8 million, down from last year's adjusted operating profit of $56 million.

For the better part of the past 15 years, Advance Auto Parts has grappled with bloated expenses and supply chain inefficiencies that continue to plague its cost structure and product availability. The company’s first two attempts at a strategic turnaround failed to materialize under past CEOs Darren Jackson (2008-15) and Tom Greco (2016-23). In 2023, the firm upon Shane O’Kelly to lead another turnaround.

We expect to lower our $54 fair value estimate by around a mid-single-digit percentage after digesting no-moat Advance Auto Parts’ fourth-quarter earnings, primarily due to a slight reduction in our midcycle operating margin, which currently sits at 4.3%. The reduction mainly stems from our expectation for muted operating expense leverage as we think Advance’s top-line growth will continue to trail that of the broader auto parts retailing industry.

For the better part of the past 15 years, Advance Auto Parts has grappled with bloated expenses and supply chain inefficiencies that continue to plague its cost structure and product availability. The company’s first two attempts at a strategic turnaround failed to materialize under past CEO Darren Jackson (2008-2015) and Tom Greco (2016-2023), and the firm has recently called upon Shane O’Kelly to lead another turnaround.

We plan to modestly reduce our $57 fair value estimate on no-moat Advance Auto Parts after digesting its lackluster third-quarter results and management’s long-term strategic outlook following its sale of Worldpac.

For the better part of the past 15 years, Advance Auto Parts has grappled with bloated expenses and supply chain inefficiencies that continue to plague its cost structure and product availability. The company’s first two attempts at a strategic turnaround failed to materialize under past CEO Darren Jackson (2008-2015) and Tom Greco (2016-2023), and the firm has recently called upon Shane O’Kelly to lead another turnaround.

We anticipate lowering our $64 per share fair value estimate for no-moat Advance Auto Parts by more than 10% following its uninspiring second-quarter earnings and its announced sale of Worldpac. The firm’s results, while comparable sales growth of 0.4% slightly outperformed our expectations, an operating margin of 2.7% (down 230 basis points from the prior year) came in well below our 3.5% forecast primarily due to continued price cuts and increased wage investments. Management also proceeded to slash its full-year guidance, calling for comp growth of flat to down 1% (from flat to up 1%), earnings per share of $2.00-$2.50 (from $3.75-$4.25), and free cash flow of at least $100 million (from $250 million).

Despite serving as a leading auto parts retailer across North America, we do not think Advance Auto Parts benefits from a durable competitive edge and thus lacks confidence in its ability to outearn its cost of capital over the following decade. After suffering from operational mismanagement and poor supply chain integration, the retailer is set to embark on its third turnaround attempt in 15 years with Shane O’Kelly at the helm. While we look favorably upon management’s plans to cut unnecessary corporate costs and improve distribution speed, we find it increasingly difficult for the auto parts retailer to close the wide operational gap that exists between it and its most prodigious competitors, such as wide-moat firms AutoZone and O’Reilly, and narrow-moat Genuine Parts (Napa).

For the better part of the past 15 years, Advance Auto Parts has grappled with bloated expenses and supply chain inefficiencies that continue to plague its cost structure and product availability. The company’s first two attempts at a strategic turnaround failed to materialize under past CEO Darren Jackson (2008-2015) and Tom Greco (2016-2023), and the firm has recently called upon Shane O’Kelly to lead another turnaround.