Advance Auto Parts, Inc. (NYSE:AAP)

autowhitetridmic

AAP is churning out cash, and has excellent ROIC/CROIC (24% by my calculations TTM). Earnings quality looks very good, and DSO is stable, even declining slightly. I would like to get this cheaper but I still think this is a fair price for this business.

AAP has strategies in place to gain market share and solidify their position in the industry.

AAP is pushing hard to gain back commercial sales - that is, selling parts to shops. They aren't expanding agressively with new stores to do it, they are using existing stores. They have recruited top talent at the store level to achieve this, and I think we'll see the results in the coming years. People's cars aren't getting any younger, and few are buying new.

S&P 5 star 0.4 % div

no reason for this to be down so low. hidden gem here in my opinion.

1x - 4/1

Think about it - 90% of Americans own 2 main items - TVs and Cars. When was the last time your car broke down and had to go pick something up from an auto store? Strong business, but a little over priced. We'll see what happens.

New high list dictates all educated investing.

Trucking up while everyone else is down

Trading well below fair value.

The ROE has been slightly higher than 20% for the past five years. They have more than 3000 stores in 40 states. There is still room for expansion, if you ask us.

Advance Auto Parts, Inc. (AAP) will continue to do well amid record unemployment, and consumer credit pains. Demand for auto parts will only increase.

It's all about the economy and familys economizing. That is, not buying new cars that they might have in a more stable economy.

This is the only place I get my auto parts. Great company and knowledgeable workers.

Should be excellent this year - fewer new car purchases means more used car parts bought.

With consumers trying to strech their dollars further, they are keeping cars longer and fixing them themselves or having skilled friends or relative fix them using parts from stores like Advanced Auto Parts.

Fewer new cars beings sold means more parts being sold.

Strangely, despite strong margins, good earnings and a low P/E, I look for this chain to under-perform for a while. The reason? As more and more people convert to more fuel efficient vehicles, they will have to purchase NEW since there are so few gas misers available used. Consequently, I expect less need for parts as the nation's auto fleet becomes less aged during this transition.