December 5, 2023

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Where Will Advance Auto Parts Stock Be In 4 Years? (NYSE:AAP)

Where Will Advance Auto Parts Stock Be In 4 Years? (NYSE:AAP)

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Introduction

Advance Auto Parts (NYSE:AAP) is an interesting stock to analyze in the current market environment for a couple of reasons. First, I think it’s interesting to compare them to their competitors, AutoZone (AZOORLY

Chart
Data by YCharts

Advanced Auto Parts earnings history

FAST Graphs

Chart
Data by YCharts

Chart
Data by YCharts

Advanced Auto Parts Historical Earnings Trends

FAST Graphs

Year Earnings for Year Cumulative Earnings

1

$8.25 $8.25
2 $8.39 $16.64
3 $8.53 $25.16
4 $8.67 $33.83
5 $8.81 $42.64
6 $8.96 $51.60
7 $9.11 $60.71
8 $9.26 $69.97
9 $9.41 $79.38
10 $9.57 $88.95
Total $88.95 $100 + $88.95 = $188.95

4-Year No Mean Reversion 4-year total return expectation

4-year return expectation minus SPY’s +27.48{ca2182fc8fed51dc37b95061ee48b5056cde1176732b225548c54a0c0156d303}

4-year return expectation minus TFLO +17.00{ca2182fc8fed51dc37b95061ee48b5056cde1176732b225548c54a0c0156d303}

AAP +28.99{ca2182fc8fed51dc37b95061ee48b5056cde1176732b225548c54a0c0156d303} +1.51{ca2182fc8fed51dc37b95061ee48b5056cde1176732b225548c54a0c0156d303} +11.99{ca2182fc8fed51dc37b95061ee48b5056cde1176732b225548c54a0c0156d303}

With a Generic 7{ca2182fc8fed51dc37b95061ee48b5056cde1176732b225548c54a0c0156d303} 10-year Mean Reversion Assumption 4-year total return expectation 4-year return expectation minus SPY’s +13.62{ca2182fc8fed51dc37b95061ee48b5056cde1176732b225548c54a0c0156d303} 4-year return expectation minus TFLO’s +17.00{ca2182fc8fed51dc37b95061ee48b5056cde1176732b225548c54a0c0156d303}
AAP +20.60{ca2182fc8fed51dc37b95061ee48b5056cde1176732b225548c54a0c0156d303} +6.98{ca2182fc8fed51dc37b95061ee48b5056cde1176732b225548c54a0c0156d303} +3.60{ca2182fc8fed51dc37b95061ee48b5056cde1176732b225548c54a0c0156d303}