STOCKS: I'm buying Advance Auto Parts (AAP) stock

Advance Auto Parts has two competitors: O’Reilly Auto Parts and AutoZone. They are all about the same size:

  • Advance Auto Parts: 4687 stores. Revenue is 11.2 billion. 68,000 employees.

  • O’Reilly Auto Parts: 6,000 stores. Revenue is 15.6 billion. 83,600 employees.

  • AutoZone: 7,140 stores. Revenue is 17.4 billion. 112,000 employees.

But their price to book and P/E is where Advance Auto Parts differs from the other two:

  • Advance Auto Parts: Price to book is 1.2. P/E is 8.72.

  • O’Reilly Auto Parts: Price to book is -32.4. P/E is 25.0.

  • AutoZone: Price to book is -10.3. P/E 19.8

Advance Auto Parts just got a new CEO and he announced that they are selling two of their side companies and laying off 400 employees to cut $100 million in expenses.

Furthermore, we are all still stuck with Bidenomics for another year. There are 4 reasons Americans will have trouble buying new cars and instead will have to repair their existing cars:

  1. Average credit card balances are at an all-time high, which makes getting a new car loan more difficult. Source
  2. The number of car loans that are 60 days late is also at an all-time high, which makes getting a new car loan more difficult. Source
  3. Interest rates are high which increases the price of financing a new car.
  4. Auto worker unions successfully negotiated higher wages which will increase the price of a new car.

Winter is coming = dead batteries and fender benders.

AAP looks like a buy to me.

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A disgruntled employ set the Advance Auto Parts near me on fire. Then he watched the fire department put it out (total loss damaged and closed the two adjacent buildings). Then he turned himself in.

What an ass!

Footnote: If you change your own oil, Home depot 5 quart bottle is at least 10 dollars cheaper than auto parts stores. They also have some oil filters.

Is this same ‘keep your car longer’ scenario why we’ve seen so many car washes go up lately? Seems like we’ve had 3-4 pop up in my small town alone.

Side note: Ya can’t use the NACHI X-Plan on a Transit. Paid $74,000 for this bad boy yesterday.

That’s my thinking.

Is NAPA still around and a competitor? There are a bunch of those stores around Oregon and some in Maui but I’m not sure about elsewhere.

NAPA has over 100 stores in Colorado alone. Stores in every state and US territory as well as other countries. They are still around!