ADVANCE AUTO PARTS INC (AAP) Fundamental Analysis & Valuation

NYSE:AAP • US00751Y1064

Current stock price

56.98 USD
+2.48 (+4.55%)
Last:

This AAP fundamental analysis includes valuation metrics, fair value assessment, financial health analysis, profitability trends, growth metrics and dividend sustainability analysis.

3

1. AAP Profitability Analysis

1.1 Basic Checks

  • In the past year AAP was profitable.
  • In the past year AAP has reported a negative cash flow from operations.
  • Of the past 5 years AAP 4 years were profitable.
  • Of the past 5 years AAP 4 years had a positive operating cash flow.
AAP Yearly Net Income VS EBIT VS OCF VS FCFAAP Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 500M 1B

1.2 Ratios

  • With a Return On Assets value of 0.37%, AAP perfoms like the industry average, outperforming 50.00% of the companies in the same industry.
  • AAP has a Return On Equity (2.00%) which is comparable to the rest of the industry.
  • The Return On Invested Capital of AAP (2.22%) is comparable to the rest of the industry.
Industry RankSector Rank
ROA 0.37%
ROE 2%
ROIC 2.22%
ROA(3y)-0.83%
ROA(5y)1.35%
ROE(3y)-4.1%
ROE(5y)5.26%
ROIC(3y)N/A
ROIC(5y)N/A
AAP Yearly ROA, ROE, ROICAAP Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 10 -10

1.3 Margins

  • Looking at the Profit Margin, with a value of 0.51%, AAP is in line with its industry, outperforming 52.42% of the companies in the same industry.
  • In the last couple of years the Profit Margin of AAP has declined.
  • Looking at the Operating Margin, with a value of 2.50%, AAP is in line with its industry, outperforming 54.84% of the companies in the same industry.
  • AAP's Operating Margin has declined in the last couple of years.
  • Looking at the Gross Margin, with a value of 43.87%, AAP is in the better half of the industry, outperforming 69.35% of the companies in the same industry.
  • In the last couple of years the Gross Margin of AAP has remained more or less at the same level.
Industry RankSector Rank
OM 2.5%
PM (TTM) 0.51%
GM 43.87%
OM growth 3Y-28.22%
OM growth 5Y-20.59%
PM growth 3Y-51.56%
PM growth 5Y-36.3%
GM growth 3Y-0.48%
GM growth 5Y-0.23%
AAP Yearly Profit, Operating, Gross MarginsAAP Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 10 20 30 40

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2

2. AAP Health Analysis

2.1 Basic Checks

  • With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), AAP is destroying value.
  • AAP has more shares outstanding than it did 1 year ago.
  • Compared to 5 years ago, AAP has less shares outstanding
  • AAP has a worse debt/assets ratio than last year.
AAP Yearly Shares OutstandingAAP Yearly Shares OutstandingYearly Shares Outstanding 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 20M 40M 60M
AAP Yearly Total Debt VS Total AssetsAAP Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2B 4B 6B 8B 10B

2.2 Solvency

  • Based on the Altman-Z score of 1.80, we must say that AAP is in the distress zone and has some risk of bankruptcy.
  • AAP's Altman-Z score of 1.80 is in line compared to the rest of the industry. AAP outperforms 46.77% of its industry peers.
  • A Debt/Equity ratio of 1.55 is on the high side and indicates that AAP has dependencies on debt financing.
  • The Debt to Equity ratio of AAP (1.55) is worse than 64.52% of its industry peers.
Industry RankSector Rank
Debt/Equity 1.55
Debt/FCF N/A
Altman-Z 1.8
ROIC/WACC0.37
WACC6.02%
AAP Yearly LT Debt VS Equity VS FCFAAP Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 1B 2B 3B

2.3 Liquidity

  • A Current Ratio of 1.75 indicates that AAP should not have too much problems paying its short term obligations.
  • The Current ratio of AAP (1.75) is better than 72.58% of its industry peers.
  • A Quick Ratio of 0.87 indicates that AAP may have some problems paying its short term obligations.
  • AAP's Quick ratio of 0.87 is fine compared to the rest of the industry. AAP outperforms 68.55% of its industry peers.
Industry RankSector Rank
Current Ratio 1.75
Quick Ratio 0.87
AAP Yearly Current Assets VS Current LiabilitesAAP Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2B 4B 6B

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WACCDebt/EquityHow to determine the health of a companyAltman-Z scoreShow peers with great health

4

3. AAP Growth Analysis

3.1 Past

  • The Earnings Per Share has grown by an impressive 1025.00% over the past year.
  • Measured over the past years, AAP shows a very negative growth in Earnings Per Share. The EPS has been decreasing by -23.36% on average per year.
  • AAP shows a very negative growth in Revenue. In the last year, the Revenue has decreased by -31.19%.
  • The Revenue has been decreasing by -3.17% on average over the past years.
EPS 1Y (TTM)1025%
EPS 3Y-44.31%
EPS 5Y-23.36%
EPS Q2Q%172.88%
Revenue 1Y (TTM)-31.19%
Revenue growth 3Y-8.3%
Revenue growth 5Y-3.17%
Sales Q2Q%-1.15%

3.2 Future

  • AAP is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 15.23% yearly.
  • Based on estimates for the next years, AAP will show a small growth in Revenue. The Revenue will grow by 1.79% on average per year.
EPS Next Y23.76%
EPS Next 2Y33.2%
EPS Next 3Y28.25%
EPS Next 5Y15.23%
Revenue Next Year-0.45%
Revenue Next 2Y1.02%
Revenue Next 3Y1.42%
Revenue Next 5Y1.79%

3.3 Evolution

  • When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
  • The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
AAP Yearly Revenue VS EstimatesAAP Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2015 2017 2019 2021 2023 2025 2027 2029 2031 2033 2B 4B 6B 8B 10B
AAP Yearly EPS VS EstimatesAAP Yearly EPS VS EstimatesYearly EPS VS Estimates 2015 2017 2019 2021 2023 2025 2027 2029 2031 2033 0 2 4 6 8 10

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3

4. AAP Valuation Analysis

4.1 Price/Earnings Ratio

  • Based on the Price/Earnings ratio of 25.32, the valuation of AAP can be described as expensive.
  • Based on the Price/Earnings ratio, AAP is valued a bit cheaper than the industry average as 62.10% of the companies are valued more expensively.
  • Compared to an average S&P500 Price/Earnings ratio of 26.91, AAP is valued at the same level.
  • With a Price/Forward Earnings ratio of 20.46, AAP is valued on the expensive side.
  • Based on the Price/Forward Earnings ratio, AAP is valued a bit cheaper than 63.71% of the companies in the same industry.
  • Compared to an average S&P500 Price/Forward Earnings ratio of 23.69, AAP is valued at the same level.
Industry RankSector Rank
PE 25.32
Fwd PE 20.46
AAP Price Earnings VS Forward Price EarningsAAP Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 20 40 60

4.2 Price Multiples

  • Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of AAP indicates a somewhat cheap valuation: AAP is cheaper than 70.97% of the companies listed in the same industry.
Industry RankSector Rank
P/FCF N/A
EV/EBITDA 7.31
AAP Per share dataAAP EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 50 100

4.3 Compensation for Growth

  • AAP's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
  • A more expensive valuation may be justified as AAP's earnings are expected to grow with 28.25% in the coming years.
PEG (NY)1.07
PEG (5Y)N/A
EPS Next 2Y33.2%
EPS Next 3Y28.25%

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Price/EarningsPrice/FCFFCF per shareEV/EBITDAPEG RATIOShow best valued peers

4

5. AAP Dividend Analysis

5.1 Amount

  • AAP has a Yearly Dividend Yield of 1.94%.
  • AAP's Dividend Yield is a higher than the industry average which is at 3.07.
  • AAP's Dividend Yield is comparable with the S&P500 average which is at 1.89.
Industry RankSector Rank
Dividend Yield 1.94%

5.2 History

  • The dividend of AAP is nicely growing with an annual growth rate of 32.92%!
  • AAP has been paying a dividend for at least 10 years, so it has a reliable track record.
  • The dividend of AAP decreased recently.
Dividend Growth(5Y)32.92%
Div Incr Years0
Div Non Decr Years1
AAP Yearly Dividends per shareAAP Yearly Dividends per shareYearly Dividends per share 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 1 2 3 4 5

5.3 Sustainability

  • AAP pays out 136.36% of its income as dividend. This is not a sustainable payout ratio.
  • AAP's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP136.36%
EPS Next 2Y33.2%
EPS Next 3Y28.25%
AAP Yearly Income VS Free CF VS DividendAAP Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 200M -200M 400M 600M 800M
AAP Dividend Payout.AAP Dividend Payout, showing the Payout Ratio.AAP Dividend Payout.PayoutRetained Earnings

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AAP Fundamentals: All Metrics, Ratios and Statistics

ADVANCE AUTO PARTS INC

NYSE:AAP (4/9/2026, 1:14:20 PM)

56.98

+2.48 (+4.55%)

Chartmill FA Rating
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)02-13
Earnings (Next)05-20
Inst Owners127.14%
Inst Owner Change0%
Ins Owners1.03%
Ins Owner Change5%
Market Cap3.42B
Revenue(TTM)8.60B
Net Income(TTM)44.00M
Analysts57.14
Price Target57.41 (0.75%)
Short Float %19.24%
Short Ratio5.95
Dividend
Industry RankSector Rank
Dividend Yield 1.94%
Yearly Dividend1
Dividend Growth(5Y)32.92%
DP136.36%
Div Incr Years0
Div Non Decr Years1
Ex-Date04-10
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)62.43%
Min EPS beat(2)21.16%
Max EPS beat(2)103.71%
EPS beat(4)4
Avg EPS beat(4)54.25%
Min EPS beat(4)18.85%
Max EPS beat(4)103.71%
EPS beat(8)5
Avg EPS beat(8)10.85%
EPS beat(12)5
Avg EPS beat(12)-42.94%
EPS beat(16)6
Avg EPS beat(16)-32.17%
Revenue beat(2)1
Avg Revenue beat(2)-0.19%
Min Revenue beat(2)-0.44%
Max Revenue beat(2)0.05%
Revenue beat(4)3
Avg Revenue beat(4)0.64%
Min Revenue beat(4)-0.44%
Max Revenue beat(4)2.34%
Revenue beat(8)4
Avg Revenue beat(8)-2.11%
Revenue beat(12)5
Avg Revenue beat(12)-1.57%
Revenue beat(16)6
Avg Revenue beat(16)-1.5%
PT rev (1m)0%
PT rev (3m)4.94%
EPS NQ rev (1m)4.83%
EPS NQ rev (3m)9.73%
EPS NY rev (1m)0%
EPS NY rev (3m)1.93%
Revenue NQ rev (1m)0.74%
Revenue NQ rev (3m)-0.38%
Revenue NY rev (1m)-0.22%
Revenue NY rev (3m)-1.56%
Valuation
Industry RankSector Rank
PE 25.32
Fwd PE 20.46
P/S 0.4
P/FCF N/A
P/OCF N/A
P/B 1.56
P/tB 2.85
EV/EBITDA 7.31
EPS(TTM)2.25
EY3.95%
EPS(NY)2.78
Fwd EY4.89%
FCF(TTM)-4.97
FCFYN/A
OCF(TTM)-0.77
OCFYN/A
SpS143.32
BVpS36.62
TBVpS19.96
PEG (NY)1.07
PEG (5Y)N/A
Graham Number43.06
Profitability
Industry RankSector Rank
ROA 0.37%
ROE 2%
ROCE 2.81%
ROIC 2.22%
ROICexc 3.75%
ROICexgc 4.82%
OM 2.5%
PM (TTM) 0.51%
GM 43.87%
FCFM N/A
ROA(3y)-0.83%
ROA(5y)1.35%
ROE(3y)-4.1%
ROE(5y)5.26%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexgc growth 3Y-27.34%
ROICexgc growth 5Y-18.96%
ROICexc growth 3Y-26.3%
ROICexc growth 5Y-17.96%
OM growth 3Y-28.22%
OM growth 5Y-20.59%
PM growth 3Y-51.56%
PM growth 5Y-36.3%
GM growth 3Y-0.48%
GM growth 5Y-0.23%
F-Score4
Asset Turnover0.73
Health
Industry RankSector Rank
Debt/Equity 1.55
Debt/FCF N/A
Debt/EBITDA 7.01
Cap/Depr 92.65%
Cap/Sales 2.93%
Interest Coverage 2.83
Cash Conversion N/A
Profit Quality N/A
Current Ratio 1.75
Quick Ratio 0.87
Altman-Z 1.8
F-Score4
WACC6.02%
ROIC/WACC0.37
Cap/Depr(3y)77.89%
Cap/Depr(5y)99.04%
Cap/Sales(3y)2.52%
Cap/Sales(5y)2.8%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)1025%
EPS 3Y-44.31%
EPS 5Y-23.36%
EPS Q2Q%172.88%
EPS Next Y23.76%
EPS Next 2Y33.2%
EPS Next 3Y28.25%
EPS Next 5Y15.23%
Revenue 1Y (TTM)-31.19%
Revenue growth 3Y-8.3%
Revenue growth 5Y-3.17%
Sales Q2Q%-1.15%
Revenue Next Year-0.45%
Revenue Next 2Y1.02%
Revenue Next 3Y1.42%
Revenue Next 5Y1.79%
EBIT growth 1Y167.53%
EBIT growth 3Y-34.18%
EBIT growth 5Y-23.11%
EBIT Next Year195%
EBIT Next 3Y48.35%
EBIT Next 5Y26.16%
FCF growth 1Y-209.88%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y-154.35%
OCF growth 3YN/A
OCF growth 5YN/A

ADVANCE AUTO PARTS INC / AAP Fundamental Analysis FAQ

What is the fundamental rating for AAP stock?

ChartMill assigns a fundamental rating of 3 / 10 to AAP.


Can you provide the valuation status for ADVANCE AUTO PARTS INC?

ChartMill assigns a valuation rating of 3 / 10 to ADVANCE AUTO PARTS INC (AAP). This can be considered as Overvalued.


What is the profitability of AAP stock?

ADVANCE AUTO PARTS INC (AAP) has a profitability rating of 3 / 10.


What is the valuation of ADVANCE AUTO PARTS INC based on its PE and PB ratios?

The Price/Earnings (PE) ratio for ADVANCE AUTO PARTS INC (AAP) is 25.32 and the Price/Book (PB) ratio is 1.56.


Is the dividend of ADVANCE AUTO PARTS INC sustainable?

The dividend rating of ADVANCE AUTO PARTS INC (AAP) is 4 / 10 and the dividend payout ratio is 136.36%.