To the annoyance of some shareholders, Advance Auto Parts, Inc. (NYSE:AAP) shares are down a considerable 27% in the last month, which continues a horrid run for the company. The drop over the last 30 days has capped off a tough year for shareholders, with the share price down 33% in that time.
Even after such a large drop in price, it's still not a stretch to say that Advance Auto Parts' price-to-sales (or "P/S") ratio of 0.2x right now seems quite "middle-of-the-road" compared to the Specialty Retail industry in the United States, where the median P/S ratio is around 0.4x. Although, it's not wise to simply ignore the P/S without explanation as investors may be disregarding a distinct opportunity or a costly mistake.
What Does Advance Auto Parts' P/S Mean For Shareholders?
With revenue growth that's inferior to most other companies of late, Advance Auto Parts has been relatively sluggish. Perhaps the market is expecting future revenue performance to lift, which has kept the P/S from declining. However, if this isn't the case, investors might get caught out paying too much for the stock.
Keen to find out how analysts think Advance Auto Parts' future stacks up against the industry? In that case, our free report is a great place to start.
How Is Advance Auto Parts' Revenue Growth Trending?
Advance Auto Parts' P/S ratio would be typical for a company that's only expected to deliver moderate growth, and importantly, perform in line with the industry.
Retrospectively, the last year delivered virtually the same number to the company's top line as the year before. That's essentially a continuation of what we've seen over the last three years, as its revenue growth has been virtually non-existent for that entire period. Accordingly, shareholders probably wouldn't have been satisfied with the complete absence of medium-term growth.
Looking ahead now, revenue is anticipated to climb by 1.5% each year during the coming three years according to the analysts following the company. That's shaping up to be materially lower than the 5.7% per year growth forecast for the broader industry.
With this in mind, we find it intriguing that Advance Auto Parts' P/S is closely matching its industry peers. It seems most investors are ignoring the fairly limited growth expectations and are willing to pay up for exposure to the stock. Maintaining these prices will be difficult to achieve as this level of revenue growth is likely to weigh down the shares eventually.
What We Can Learn From Advance Auto Parts' P/S?
With its share price dropping off a cliff, the P/S for Advance Auto Parts looks to be in line with the rest of the Specialty Retail industry. It's argued the price-to-sales ratio is an inferior measure of value within certain industries, but it can be a powerful business sentiment indicator.
Our look at the analysts forecasts of Advance Auto Parts' revenue prospects has shown that its inferior revenue outlook isn't negatively impacting its P/S as much as we would have predicted. At present, we aren't confident in the P/S as the predicted future revenues aren't likely to support a more positive sentiment for long. Circumstances like this present a risk to current and prospective investors who may see share prices fall if the low revenue growth impacts the sentiment.
Don't forget that there may be other risks. For instance, we've identified 2 warning signs for Advance Auto Parts (1 is concerning) you should be aware of.
If you're unsure about the strength of Advance Auto Parts' business, why not explore our interactive list of stocks with solid business fundamentals for some other companies you may have missed.
Have feedback on this article? Concerned about the content?Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
一部の株主のいらだちにもかかわらず、Advance Auto Parts, Inc. (NYSE:AAP) の株価は過去1ヶ月でかなりの27%下落しており、この企業にとってはひどい調子のままです。過去30日間の下落は株主にとってつらい1年の締めくくりとなり、その期間で株価は33%下落しています。
ここまでの大幅な値下がりの後でも、Advance Auto Partsの価格売上倍率 (または「P/S倍率」) は現在、アメリカの専門小売業界と比べてかなり「中庸」の0.2倍と言っても過言ではありません。アメリカの専門小売業界の中央値P/S倍率は約0.4倍です。ただし、このP/Sを説明なしに無視することは賢明ではありません。投資家は明確なチャンスや高いコストのミスを無視している可能性があります。
Advance Auto PartsのP/S倍率は株主にとってどういう意味を持つのでしょうか?
最近の他の企業と比べて売上成長が劣っているため、Advance Auto Partsは比較的停滞しています。おそらく市場は将来の売上パフォーマンスの向上を期待しており、それがP/Sの低下を防いでいます。しかし、それが事実でない場合、投資家は株式に高い価格を支払うリスクがあります。
Advance Auto Partsの将来の見通しは業種と比較してどのような状況になるのか、アナリストの意見を知りたいですか?それなら、私たちの無料レポートがおすすめです。
Advance Auto Partsの株価が急落しており、P/Sは専門小売業界全体と同じくらいの水準にあります。P/Sは特定の業種では価値の劣る指標だと主張されていますが、ビジネスセンチメントの強力な指標になる場合もあります。
Advance Auto Partsの売上高の見通しを見ると、予想される売上高の低調がP/Sに予想よりも大きな影響を与えていないことがわかりました。現時点では、将来の売上高がポジティブなセンチメントを長期間サポートする可能性は低いため、P/Sに自信を持てません。このような状況では、低い売上成長がセンチメントに影響を与える可能性があるため、現在の投資家や将来の投資家にリスクが生じることがあります。
Advance Auto Partsには他にリスクがあることを忘れないでください。例えば、Advance Auto Partsには2つの警告サイン(1つは懸念がある)がありますので、意識しておく必要があります。
Advance Auto Partsのビジネスの強さに自信が持てない場合は、見逃してしまったその他の会社のしっかりしたビジネスの基盤を持つ株式のインタラクティブなリストをご覧になることをおすすめします。
オーストラリアでは、moomooの投資商品及びサービスはMoomoo Securities Australia Limitedによって提供され、オーストラリア証券投資委員会(ASIC)の管理を受けております(AFSL No. 224663)。「金融サービスガイド」、「利用規約」、「プライバシーポリシー」などの詳細は、Moomoo Securities Australia Limitedのウェブサイトhttps://www.moomoo.com/auでご確認いただけます。
オーストラリアでは、moomooの投資商品及びサービスはMoomoo Securities Australia Limitedによって提供され、オーストラリア証券投資委員会(ASIC)の管理を受けております(AFSL No. 224663)。「金融サービスガイド」、「利用規約」、「プライバシーポリシー」などの詳細は、Moomoo Securities Australia Limitedのウェブサイトhttps://www.moomoo.com/auでご確認いただけます。