Nomura Securities Maintains a 'Reduce' on Advance Auto Parts (AAP); Q3 Results First Look

Nomura Securities maintains a 'Reduce' on Advance Auto Parts (NYSE: AAP) price target of $54.00.

Nomura analyst, Aram Rubinson, said, "Advance Auto reported Q3 results well ahead of Street expectations. EPS were $1.41 versus the Street at $1.18. EPS far exceeded our bearish forecast of $1.04. The Q3 beat was almost entirely driven by SG&A, which fell -5.4% on a per foot basis. We remain concerned about the gross margin and inventory level as well as the sustainability of some of the SG&A cuts, which continued to be fueled by incentive compensation. Nonetheless, it is clear that we have been far too cautious in our modeling. Our estimates are under review, but we are holding our Reduce rating. We recognize that is not an ideal combination."

For an analyst ratings summary and ratings history on Advance Auto Parts click here. For more ratings news on Advance Auto Parts click here.

Shares of Advance Auto Parts closed at $66.37 yesterday.

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