Advance Auto Parts, the leading aftermarket car-parts retailer, has announced a significant adjustment to its earnings forecast and sales guidance for 2023. The company reported a loss in the third quarter, prompting the revision.
Diminished Earnings Outlook
Previously projected at $4.50 to $5.10 per share, Advance Auto Parts now expects earnings to be in the range of $1.40 to $1.80 per share. This substantial decrease in earnings forecast reflects the challenges faced by the company.
Lowered Sales Expectations
Sales guidance for the year has also been revised downwards to $11.25 billion to $11.3 billion, compared to the previous range of $11.35 billion. This adjustment reflects a slightly lowered ceiling and reflects the challenges in the market.
Mixed Projections for Comparable Sales
The projected outlook for comparable sales, which factors in store openings and closings, has also been modified. Instead of a slight increase or decrease compared to 2022, Advance Auto Parts now projects that comparable sales will either remain flat or experience a slight decline.
Store Growth Target Cut
Advance Auto Parts has adjusted its store growth target from a range of 55 to 65 stores to a new range of 40 to 60 stores. This change reflects the company’s strategic adjustments and market conditions.
Revised Free Cash Flow Projection
The company now forecasts free cash flow to be in the range of $50 million to $100 million, down from the previous projection of $150 million to $250 million. This adjustment considers various factors including costs incurred during the third quarter and higher product costs in the last quarter of the year.
For more information, please contact Advance Auto Parts.