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Added to YB: 2024-09-09

Pitch date: 2024-09-06

AAP [bullish]

Advance Auto Parts, Inc.

+45.86%

current return

Author Info

Hidden Rock Capital is an investment advisor unearthing asymmetric investment opportunities hiding in plain sight. Sign up for the newsletter.

Company Info

Advance Auto Parts, Inc. provides automotive aftermarket parts. The company offers batteries and battery accessories; belts and hoses; brakes and brake pads; chassis parts; climate control parts; clutches and drive shafts; engines and engine parts; exhaust systems and parts; hub assemblies; ignition components and wires; radiators and cooling parts; starters and alternators; and steering and alignment parts.

Market Cap

$3.4B

Pitch Price

$38.38

Price Target

100.00 (+79%)

Dividend

1.76%

EV/EBITDA

5.30

P/E

50.21

EV/Sales

0.69

Sector

Specialty Retail

Category

turnaround

Show full summary:
Revving up for Advance Auto Parts

AAP: New CEO O'Kelly targeting turnaround via Worldpac sale ($1.2B), Carquest divestment, inventory system optimization. $100M FCF (1% margin) guided for 2024; potential 5-6% FCF margin = $500-600M. At 10x FCF, $80-100/share PT (vs $40 current). Activists involved. Risks: execution, competition from AZO/ORLY. 18-month timeframe.

Read full article (3 min)