Advance Auto Parts (NYSE:AAP) Announces Quarterly Earnings Results, Beats Expectations By $0.02 EPS

Advance Auto Parts (NYSE:AAP) announced its quarterly earnings data on Thursday. The company reported $0.79 earnings per share for the quarter, topping analysts’ consensus estimates of $0.77 by $0.02, FiscalAI reports. Advance Auto Parts had a net margin of 0.97% and a return on equity of 9.84%. The business had revenue of $2.01 billion for the quarter, compared to analysts’ expectations of $2.04 billion. During the same quarter in the prior year, the company earned $0.92 earnings per share. The business’s revenue was down 1.2% compared to the same quarter last year.

Here are the key takeaways from Advance Auto Parts’ conference call:

• Third-quarter comparable sales fell 1.2%, and adjusted diluted EPS declined to $0.79 from $0.92 a year earlier. Weak DIY demand, pressured household budgets, and consumers deferring larger repairs weighed on results.
• Sales trends improved through the quarter, turning positive in the final four weeks as DIY declines narrowed; Pro comparable sales rose in the low single digits, led by Main Street Pro. Management also cited improving customer metrics, including NPS above 80 and attachment rates in the mid-30% range.
• Advance raised its full-year free cash flow outlook to approximately $150 million, implying more than $400 million of year-over-year growth. It narrowed adjusted operating margin guidance to 4.0%–4.3%, reaffirming the midpoint and forecasting more than 150 basis points of expansion versus last year.
• The company is expanding its market hub network and pursuing assortment, supply-chain, and store-productivity initiatives, including expected transportation savings of more than 20 basis points. Management sees these efforts supporting future growth and margins, though results depend on continued execution amid cost and demand pressures.

Advance Auto Parts Stock Performance

Shares of Advance Auto Parts stock traded down $2.45 during trading on Friday, hitting $45.67. 1,667,684 shares of the company’s stock traded hands, compared to its average volume of 1,462,707. The company has a debt-to-equity ratio of 1.50, a current ratio of 1.75 and a quick ratio of 0.85. Advance Auto Parts has a 1 year low of $37.89 and a 1 year high of $65.20. The stock has a market capitalization of $2.76 billion, a P/E ratio of 13.39, a PEG ratio of 0.92 and a beta of 1.02. The business has a 50-day simple moving average of $43.30 and a 200-day simple moving average of $51.73.

Advance Auto Parts Dividend Announcement

The firm also recently declared a quarterly dividend, which will be paid on Friday, January 22nd. Stockholders of record on Friday, January 8th will be issued a dividend of $0.25 per share. This represents a $1.00 dividend on an annualized basis and a dividend yield of 2.2%. The ex-dividend date of this dividend is Friday, January 8th. Advance Auto Parts’s dividend payout ratio is presently 72.99%.

Key Advance Auto Parts News

Here are the key news stories impacting Advance Auto Parts this week:

• Positive Sentiment: Royal Bank of Canada raised its price target to $51 from $49 while maintaining a “sector perform” rating. The new target represented about 11.7% upside from the cited $45.67 share price. Royal Bank of Canada recommendations
• Positive Sentiment: Third-quarter adjusted earnings of $0.79 per share topped the $0.77 consensus estimate, providing a modest earnings bright spot. Advance Auto Parts Q3 earnings top estimates
• Positive Sentiment: The company declared a $0.25 dividend, offering continued income to shareholders. Advance Auto Parts declares dividend
• Negative Sentiment: Revenue was $2.01 billion, below the $2.04 billion analyst estimate and down 1.2% year over year. EPS also fell from $0.92 in the year-ago quarter, tempering the impact of the earnings beat. Advance Auto Parts Q3 results
• Negative Sentiment: Advance Auto Parts updated and narrowed its full-year 2026 outlook. The guidance revision, alongside the revenue shortfall, appears to have overshadowed the small EPS beat and contributed to a cautious investor response. Advance Auto Parts narrows 2026 outlook

Analysts Set New Price Targets

A number of brokerages have issued reports on AAP. Roth Capital set a $48.00 price objective on Advance Auto Parts in a research note on Friday, August 21st. Weiss Ratings raised Advance Auto Parts from a “sell (d+)” rating to a “hold (c-)” rating in a research note on Tuesday, October 27th. Morgan Stanley reduced their price target on Advance Auto Parts from $65.00 to $52.00 and set an “equal weight” rating for the company in a report on Friday, August 21st. Rothschild & Co Redburn downgraded Advance Auto Parts from a “neutral” rating to a “sell” rating and reduced their price target for the company from $45.00 to $32.00 in a report on Monday, October 26th. Finally, Citigroup lifted their price target on Advance Auto Parts from $45.00 to $48.00 and gave the stock a “neutral” rating in a research report on Friday, October 23rd. Three equities research analysts have rated the stock with a Buy rating, fifteen have given a Hold rating and three have given a Sell rating to the stock. According to MarketBeat.com, the stock has an average rating of “Hold” and an average target price of $47.28.

Advance Auto Parts Company Profile

Advance Auto Parts, Inc is a specialty retailer and distributor of automotive aftermarket parts, accessories, and maintenance products. The company serves both do-it-yourself customers and professional repair shops, offering products such as replacement parts, batteries, engine and drivetrain components, filters, fluids, tools, and other automotive supplies.

The company operates through a network of stores, distribution centers, and online channels under the Advance Auto Parts and Carquest brands.