Advance Auto stock plunges 35% after forecast, dividend cut
By Caroline Valetkevitch
NEW YORK (Reuters) - Advance Auto Parts Inc's stock slid by more than one-third on Wednesday in its biggest daily percentage drop since the company went public in 2001 and led a sell-off in other auto parts retailers after the company cut its dividend and full-year forecast.
Advance Auto's shares closed down 35.0% at $72.89, and hit their lowest level since March 2020.
Shares of Genuine Parts Co fell 5.6%, while Autozone eased 2.8% and O'Reilly Automotive slipped 2.7%.
The company cited elevated raw material, labor and freight costs as it reported results, and slashed its quarterly dividend to 25 cents from $1.50 previously.
Its lowered forecast follows a recent disappointing outlook from Foot Locker Inc and underscores weakness in some areas of retail this earnings season.
"In a tough earnings season, (Advance Auto) saved perhaps the worst for last, with as big a miss and cut as we can remember," D.A. Davidson analysts wrote in a research note.
Trading volume on Wednesday in Advance Auto was more than 20 million shares, about 20 times the stock's 25-day moving average and the busiest trading session on record, per Refinitiv data.
Including the session's move, Advance Auto shares are down about 50% for the year to date.
The current average Wall Street recommendation on the stock is a "hold" and the median price target is $141, according to Refinitiv data.
(Reporting by Caroline Valetkevitch in New York; Editing by Lance Tupper and Matthew Lewis)