UBS Reiterates Buy on Advance Auto Parts (AAP) Following 3Q
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UBS reiterated a Buy rating on Advance Auto Parts (NYSE: AAP), and raised the price target to $180.00 (from $175.00), following the company's 3Q earnings report and analyst meeting.
Analyst Michael Lasser commented, "The central takeaway from AAP's 3Q results & analyst meeting is that while it has made some progress, it really has so much more to go. It's comp decline of -1% (vs. our forecast of -2% & the consensus of -3.5%) represented a 2-yr stack sequential acceleration of ~250 bps. We think this improvement was mostly about undoing the issues that had long been in the making such as going to 5 day per week replenishment from 3 day (it made this change at the end of 2Q) or ceasing to check customers' engine codes (it resumed this about a month ago). Fixing these acute problems, along with easy compares can carry AAP's comp well into positive territory for at least the next few Qs. This will enable the stock to maintain its near-term momentum. Beyond that, we think the co's leadership team is focused on the right strategies to unlock the substantial long-term potential that AAP offers to shareholders."
Shares of Advance Auto Parts closed at $142.90 yesterday.
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Create E-mail Alert Related CategoriesAnalyst Comments, Analyst EPS Change, Analyst PT Change
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