ADVANCE AUTO PARTS INC (AAP) Fundamental Analysis & Valuation

NYSE:AAP • US00751Y1064

Current stock price

49.355 USD
-1.39 (-2.73%)
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.
  • AAP had a negative operating cash flow in the past year.
  • 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 50.41% of the companies in the same industry.
  • With a Return On Equity value of 2.00%, AAP perfoms like the industry average, outperforming 56.10% of the companies in the same industry.
  • AAP has a Return On Invested Capital of 2.22%. This is comparable to the rest of the industry: AAP outperforms 45.53% of its industry peers.
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

  • AAP has a Profit Margin of 0.51%. This is comparable to the rest of the industry: AAP outperforms 51.22% of its industry peers.
  • AAP's Profit Margin has declined in the last couple of years.
  • The Operating Margin of AAP (2.50%) is comparable to the rest of the 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 67.48% 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

  • AAP has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
  • The number of shares outstanding for AAP has been increased compared to 1 year ago.
  • AAP has less shares outstanding than it did 5 years ago.
  • The debt/assets ratio for AAP is higher compared to a year ago.
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 1.78, we must say that AAP is in the distress zone and has some risk of bankruptcy.
  • With a Altman-Z score value of 1.78, AAP perfoms like the industry average, outperforming 49.59% of the companies in the same industry.
  • A Debt/Equity ratio of 1.55 is on the high side and indicates that AAP has dependencies on debt financing.
  • AAP's Debt to Equity ratio of 1.55 is on the low side compared to the rest of the industry. AAP is outperformed by 64.23% of its industry peers.
Industry RankSector Rank
Debt/Equity 1.55
Debt/FCF N/A
Altman-Z 1.78
ROIC/WACC0.37
WACC5.93%
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.
  • Looking at the Current ratio, with a value of 1.75, AAP is in the better half of the industry, outperforming 72.36% of the companies in the same industry.
  • AAP has a Quick Ratio of 1.75. This is a bad value and indicates that AAP is not financially healthy enough and could expect problems in meeting its short term obligations.
  • With a decent Quick ratio value of 0.87, AAP is doing good in the industry, outperforming 68.29% of the companies in the same industry.
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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4

3. AAP Growth Analysis

3.1 Past

  • The Earnings Per Share has grown by an impressive 1025.00% over the past year.
  • AAP shows a very negative growth in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -23.36% yearly.
  • The Revenue for AAP has decreased by -31.19% in the past year. This is quite bad
  • Measured over the past years, AAP shows a decrease in Revenue. The Revenue has been decreasing by -3.17% on average per year.
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

  • The Earnings Per Share is expected to grow by 15.23% on average over the next years. This is quite good.
  • 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-0.35%
Revenue Next 2Y1.08%
Revenue Next 3Y1.37%
Revenue Next 5Y1.79%

3.3 Evolution

  • The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
  • 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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4

4. AAP Valuation Analysis

4.1 Price/Earnings Ratio

  • With a Price/Earnings ratio of 21.94, AAP is valued on the expensive side.
  • Compared to the rest of the industry, the Price/Earnings ratio of AAP indicates a somewhat cheap valuation: AAP is cheaper than 64.23% of the companies listed in the same industry.
  • When comparing the Price/Earnings ratio of AAP to the average of the S&P500 Index (25.54), we can say AAP is valued inline with the index average.
  • With a Price/Forward Earnings ratio of 17.72, AAP is valued on the expensive side.
  • AAP's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. AAP is cheaper than 63.41% of the companies in the same industry.
  • AAP is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 22.70, which is the current average of the S&P500 Index.
Industry RankSector Rank
PE 21.94
Fwd PE 17.72
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

  • AAP's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. AAP is cheaper than 69.92% of the companies in the same industry.
Industry RankSector Rank
P/FCF N/A
EV/EBITDA 6.85
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 low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
  • AAP's earnings are expected to grow with 28.25% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.92
PEG (5Y)N/A
EPS Next 2Y33.2%
EPS Next 3Y28.25%

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4

5. AAP Dividend Analysis

5.1 Amount

  • With a Yearly Dividend Yield of 2.07%, AAP has a reasonable but not impressive dividend return.
  • Compared to an average industry Dividend Yield of 2.79, AAP pays a bit more dividend than its industry peers.
  • Compared to an average S&P500 Dividend Yield of 1.89, AAP has a dividend comparable with the average S&P500 company.
Industry RankSector Rank
Dividend Yield 2.07%

5.2 History

  • On average, the dividend of AAP grows each year by 32.92%, which is quite nice.
  • AAP has been paying a dividend for at least 10 years, so it has a reliable track record.
Dividend Growth(5Y)32.92%
Div Incr Years0
Div Non Decr Years0
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

  • 136.36% of the earnings are spent on dividend by AAP. This is not a sustainable payout ratio.
  • The dividend of AAP is growing, but the earnings are growing slower. 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 (3/24/2026, 9:49:53 AM)

49.355

-1.39 (-2.73%)

Chartmill FA Rating
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)02-13
Earnings (Next)05-20
Inst Owners127.14%
Inst Owner Change3.9%
Ins Owners1.03%
Ins Owner Change5%
Market Cap2.96B
Revenue(TTM)8.60B
Net Income(TTM)44.00M
Analysts57.22
Price Target57.41 (16.32%)
Short Float %19.32%
Short Ratio5.72
Dividend
Industry RankSector Rank
Dividend Yield 2.07%
Yearly Dividend1
Dividend Growth(5Y)32.92%
DP136.36%
Div Incr Years0
Div Non Decr Years0
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)9.17%
PT rev (3m)3.88%
EPS NQ rev (1m)9.96%
EPS NQ rev (3m)2.79%
EPS NY rev (1m)3.29%
EPS NY rev (3m)1.9%
Revenue NQ rev (1m)0.97%
Revenue NQ rev (3m)-0.08%
Revenue NY rev (1m)-0.63%
Revenue NY rev (3m)-1.45%
Valuation
Industry RankSector Rank
PE 21.94
Fwd PE 17.72
P/S 0.34
P/FCF N/A
P/OCF N/A
P/B 1.35
P/tB 2.47
EV/EBITDA 6.85
EPS(TTM)2.25
EY4.56%
EPS(NY)2.78
Fwd EY5.64%
FCF(TTM)-4.97
FCFYN/A
OCF(TTM)-0.77
OCFYN/A
SpS143.32
BVpS36.62
TBVpS19.96
PEG (NY)0.92
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 1.78
F-Score4
WACC5.93%
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-0.35%
Revenue Next 2Y1.08%
Revenue Next 3Y1.37%
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 4 / 10 to ADVANCE AUTO PARTS INC (AAP). This can be considered as Fairly Valued.


Can you provide the profitability details for ADVANCE AUTO PARTS INC?

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


Can you provide the PE and PB ratios for AAP stock?

The Price/Earnings (PE) ratio for ADVANCE AUTO PARTS INC (AAP) is 21.94 and the Price/Book (PB) ratio is 1.35.


Can you provide the expected EPS growth for AAP stock?

The Earnings per Share (EPS) of ADVANCE AUTO PARTS INC (AAP) is expected to grow by 23.76% in the next year.