How Are Auto Parts Retailers Faring in September 2017?


Oct. 2 2017, Updated 9:37 a.m. ET

Top 3 US auto parts retailers

O’Reilly Automotive (ORLY), AutoZone (AZO), and Advance Auto Parts (AAP) are the three largest auto parts retailers in the United States. The stocks of these three companies have touched new record highs in the last couple of years. This year is not turning out so well for these stocks. Let’s see how they have fared so far in September compared to automakers (IYK) and the broader market.

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Back on track in September?

As of September 25, 2017, O’Reilly Automotive stock was trading at $215.15, rising 9.7% so far in September. By comparison, AutoZone has risen 10.4%, and Advance Auto Parts was trading with no change on an MTD (month-to-date) basis. The S&P 500 index (SPY) was trading with a 1.0% MTD rise.

Auto parts retailers have seen a massive value erosion so far in 2017. On a year-to-date basis, ORLY, AZO, and AAP have fallen 22.7%, 26.1%, and 42.1%, respectively, as of September 25, 2017.

Automakers General Motors (GM) and Fiat Chrysler (FCAU) have risen 15.7% and 92.8%, respectively, so far in 2017.

Auto parts companies’ falling profit margins and investors’ low expectations for upcoming earnings could be the primary reasons for their underperformance.

AutoZone reported its fiscal 4Q17 results on September 19, 2017. For more information, read AutoZone’s Fiscal 4Q17: Higher Sales and Mixed Margins.

In the next and final part of this series, we’ll see which auto parts retailers currently have the highest analysts’ “buy” ratings.


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