The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how Genuine Parts (NYSE:GPC) and the rest of the auto parts retailer stocks fared in Q2.
Cars are complex machines that need maintenance and occasional repairs, and auto parts retailers cater to the professional mechanic as well as the do-it-yourself (DIY) fixer. Work on cars may entail replacing fluids, parts, or accessories, and these stores have the parts and accessories or these jobs. While e-commerce competition presents a risk, these stores have a leg up due to the combination of broad and deep selection as well as expertise provided by sales associates. Another change on the horizon could be the increasing penetration of electric vehicles.
The 5 auto parts retailer stocks we track reported a slower Q2. As a group, revenues missed analysts’ consensus estimates by 0.7%.
Valuation multiples for many growth stocks have not yet reverted to their early 2021 highs, but the market was optimistic at the end of 2023 due to cooling inflation. This year has been a different story as mixed inflation signals have led to market volatility. However, auto parts retailer stocks have held steady amidst all this with average share prices relatively unchanged since the latest earnings results.
Weakest Q2: Genuine Parts (NYSE:GPC) Largely targeting the professional customer, Genuine Parts (NYSE:GPC) sells auto and industrial parts such as batteries, belts, bearings, and machine fluids.
Genuine Parts reported revenues of $5.96 billion, flat year on year. This print fell short of analysts’ expectations by 1.2%. Overall, it was a weak quarter for the company with underwhelming earnings guidance for the full year and a miss of analysts’ earnings estimates.
"I want to thank each of our global GPC teammates for their hard work and dedication to serving our customers," said Will Stengel, President and Chief Executive Officer.
Interestingly, the stock is up 2.8% since reporting and currently trades at $142.28.
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Best Q2: Monro (NASDAQ:MNRO) Started as a single location in Rochester, New York, Monro (NASDAQ:MNRO) provides common auto services such as brake repairs, tire replacements, and oil changes.
Monro reported revenues of $293.2 million, down 10.3% year on year, in line with analysts’ expectations. It was a very strong quarter for the company with an impressive beat of analysts’ gross margin estimates.
The market seems content with the results as the stock is up 2% since reporting. It currently trades at $26.56.
Advance Auto Parts (NYSE:NYSE:AAP) Founded in Virginia in 1932, Advance Auto Parts (NYSE:AAP) is an auto parts and accessories retailer that sells everything from carburetors to motor oil to car floor mats.
Advance Auto Parts reported revenues of $2.68 billion, flat year on year, in line with analysts’ expectations. It was a weak quarter for the company with underwhelming earnings guidance for the full year and a miss of analysts’ earnings estimates.
As expected, the stock is down 25% since the results and currently trades at $46.44.
AutoZone (NYSE:NYSE:AZO) Aiming to be a one-stop shop for the DIY customer, AutoZone (NYSE:AZO) is an auto parts and accessories retailer that sells everything from car batteries to windshield wiper fluid to brake pads.
AutoZone reported revenues of $4.24 billion, up 3.5% year on year, falling short of analysts’ expectations by 1.3%. Revenue aside, it was a mixed quarter for the company with a narrow beat of analysts’ gross margin estimates.
AutoZone had the weakest performance against analyst estimates among its peers. The stock is up 9.5% since reporting and currently trades at $3,205.
O'Reilly (NASDAQ:ORLY) Serving both the DIY customer and professional mechanic, O’Reilly Automotive (NASDAQ:ORLY) is an auto parts and accessories retailer that sells everything from fuel pumps to car air fresheners to mufflers.
O'Reilly reported revenues of $4.27 billion, up 5% year on year, falling short of analysts’ expectations by 1.1%. More broadly, it was a weaker quarter for the company with underwhelming earnings guidance for the full year.
O'Reilly scored the fastest revenue growth but had the weakest full-year guidance update among its peers. The stock is up 8.1% since reporting and currently trades at $1,138.
This content was originally published on Stock Story
