January 30, 2025
Top 10 Stock Advance Auto Parts Buy Recommendation
How to read the ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Snapshot: Advance Auto Parts – Top 10 Stock in S&P 500 Consumer Discretionary Index
Advance Auto Parts is listed as a top 10 stock on January 30, 2025 in the market index S&P US Luxury because of its high performance in at least one of the Obermatt investment strategies. While half the consolidated Obermatt Ranks are above-average, investor sentiment is negative and growth performance is below market average, both a sign for caution. Based on the Obermatt 360° View of 56 (high 56% performer), Obermatt assesses an overall buy recommendation for Advance Auto Parts on January 30, 2025.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Automotive Retail |
| Index | Dividends USA, S&P US Luxury, S&P 500 |
| Size class | X-Large |
When Obermatt identifies the Top 10 stocks in a market, it’s based on a certain investment strategy. The best performing stocks usually aren’t the ones that everyone is talking about (those are often "over-priced" and have low Value ranks).
For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).
360° View: Obermatt 360° View Advance Auto Parts Buy
| 360 METRICS | January 30, 2025 | |||||||
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| VALUE | ||||||||
| VALUE | 64 |
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| GROWTH | ||||||||
| GROWTH | 39 |
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| SAFETY | ||||||||
| SAFETY | 80 |
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| SENTIMENT | ||||||||
| SENTIMENT | 26 |
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| 360° VIEW | ||||||||
| 360° VIEW | 56 |
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ANALYSIS: With an Obermatt 360° View of 56 (better than 56% compared with alternatives), overall professional sentiment and financial characteristics for the stock Advance Auto Parts are above average. The 360° View is based on consolidating four consolidated indicators, with half the metrics below and half above average for Advance Auto Parts. The consolidated Value Rank has an attractive rank of 64, which means that the share price of Advance Auto Parts is on the lower side compared with the typical size in indicators such as revenues, profits, and invested capital. This means the stock price is lower than for 64% of alternative stocks in the same industry. The company is also safely financed with a Safety rank of 80. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of 26. Professional investors are more confident in 74% other stocks. The consolidated Growth Rank also has a low rank of 39, which means that the company is below average in terms of growth momentum when looking at financial metrics such as revenue, profit, invested capital growth, and stock returns. 61 of its competitors have better growth. ...read more
RECOMMENDATION: With a consolidated 360° View of 56, Advance Auto Parts is better positioned than 56% of all alternative stock investment opportunities based on the Obermatt Method. The picture is mixed here. The stock seems to be a good value (Value Rank of 64), and the financing structure is on the safer side (Safety Rank of 80). However, sentiment in the professional investor community is below-average (Sentiment Rank of 26), as is the growth momentum for the company (Growth Rank of 39). Since the company is good value and the share price low, it should attract investors, yet professionals are skeptical. Even though the financing structure is not as important as Value, Growth, and Sentiment, investors should still be careful with this decision and conduct further research if they are serious about investing in this company. ...read more
Sentiment Strategy: Professional Market Sentiment for Advance Auto Parts only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 26 (better than 26% compared with alternatives), overall professional sentiment and engagement for the stock Advance Auto Parts is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for Advance Auto Parts. Analyst Opinions are at a rank of 14 (worse than 86% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. Worse, Analyst Opinions Change has a rank of 43 which means that stock research experts are getting even more pessimistic. It doesn't end with the analysts. Market Pulse is also low with a rank of 25, which means that the current professional news and professional social networks are on the negative side when discussing this company (more negative news than for 75% of competitors). No wonder, the Professional Investors rank is only 47, which means that professional investors hold less stock in this company than in 53% of alternative investment opportunities. Pros tend to stay away from Advance Auto Parts, which may be due to a small company size but just as likely because of its relatively low Sentiment Rank. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 26 (less encouraging than 74% compared with investment alternatives), Advance Auto Parts has a reputation among professional investors that is below that of its competitors. Investors should be careful with this stock right now. Further research is required if an investment is desired, because the facts found in the professional community are all negative. ...read more
Value Strategy: Advance Auto Parts Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 64 (better than 64% compared with alternatives), Advance Auto Parts shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, where three out of four indicators are above average for Advance Auto Parts. Price-to-Sales (P/S) is 62 which means that the stock price compared with what market professionals expect for future sales is lower than for 62% of comparable companies, indicating a good value for Advance Auto Parts's revenue size. The same is valid for the Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 64. Finally, compared with other companies in the same industry, dividend yields of Advance Auto Parts are expected to be higher than for 82% of all competitors (a Dividend Yield rank of 82). The only low rank is for expected profits with a Price-to-Profit Rank of 13, indicating that the market expects the company's profit to be low despite a high dividend. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 64, is a buy recommendation based on Advance Auto Parts's stock price compared with the company's operational size and dividend yields. The low Profit Rank could result from a one-off charge, for instance, for an accident, a legal settlement, or a restructuring project. If the company keeps its dividends high, the low expected profit may be transitory. If that is the case, the three good value ranks for Sales, Capital, and Dividends are reliable indicators for good stock price value, a low stock price. ...read more
Growth Strategy: Advance Auto Parts Growth Momentum low
ANALYSIS: With an Obermatt Growth Rank of 39 (better than 39% compared with alternatives), Advance Auto Parts shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, where half of the indicators are below and half above average for Advance Auto Parts. Profit Growth, with a rank of 60 (better than 60% of its competitors), and Capital Growth, with a rank of 100, are both positive, which is a healthy sign for positive development. But Sales Growth has only a rank of 1, which means that, currently, professionals expect the company to grow less than 99% of its competitors, and Stock Returns are at a rank of 29. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 39, is a hold recommendation for growth and momentum investors. Stock returns that are a thing of the past can be less of a problem. Below-average revenue growth may be caused by divestments of underperforming businesses. If that is the case, then the positive developments of profit and capital growth are signs of a company with growth potential. If these are the reasons, overall growth is well on track to making this stock attractive for growth investors. ...read more
Safety Strategy: Advance Auto Parts Debt Financing Safety very solid
| SAFETY METRICS | January 30, 2025 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 58 |
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| REFINANCING | ||||||||
| REFINANCING | 90 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 33 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 80 |
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ANALYSIS: With an Obermatt Safety Rank of 80 (better than 80% compared with alternatives) for 2025, the company Advance Auto Parts has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Advance Auto Parts is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators where two out of three are above average for Advance Auto Parts.Leverage is at 58, meaning the company has a below-average debt-to-equity ratio. It has less debt than 58% of its competitors.Refinancing is at a rank of 90, meaning that the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 90% of its competitors. Liquidity is at 33, meaning that the company generates less profit to service its debt than 67% of its competitors. This indicates that the company is on the riskier side regarding debt service. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 80 (better than 80% compared with alternatives), Advance Auto Parts has a financing structure that is significantly safer than that of its competitors. Low leverage and low refinancing risk mean a safer financing situation. However, low liquidity means that current company cash flows are low in relation to the level of debt. This is a sign of caution in case it is expected for profits to remain low. ...read more
Combined financial peformance: Advance Auto Parts Top Financial Performance
| COMBINED PERFORMANCE | January 30, 2025 | |||||||
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| VALUE | ||||||||
| VALUE | 64 |
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| GROWTH | ||||||||
| GROWTH | 39 |
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| SAFETY | ||||||||
| SAFETY | 33 |
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| COMBINED | ||||||||
| COMBINED | 77 |
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ANALYSIS: With an Obermatt Combined Rank of 77 (better than 77% compared with investment alternatives), Advance Auto Parts (Automotive Retail, USA) shares have much better financial characteristics than comparable stocks. Shares of Advance Auto Parts are a good value (attractively priced) with a consolidated Value Rank of 64 (better than 64% of alternatives), are safely financed (Safety Rank of 80, which means low debt burdens), but show below-average growth (Growth Rank of 39). ...read more
RECOMMENDATION: A Combined Rank of 77, is a strong buy recommendation based on Advance Auto Parts's financial characteristics. As the company Advance Auto Parts's key financial metrics exhibit good value (Obermatt Value Rank of 64) but low growth (Obermatt Growth Rank of 39) while being safely financed (Obermatt Safety Rank of 80), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 64% of comparable companies, may also indicate that the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity and the downside is limited due to below-average financing risks. ...read more
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