Advance Auto Parts stock jumps after big profit beat, sales rise above forecasts

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Shares of Advance Auto Parts Inc. shot up 5.0% toward a 9-month high in premarket trading Tuesday, after the auto parts seller reported a fiscal second-quarter profit that was well above expectations, helped by the best same-store sales performance in nearly 10 years. Net income for the quarter to July 11 increased to $190.0 million, or $2.74 a share, from $124.8 million, or $1.73 a share, in the year-ago period. Excluding non-recurring items, adjusted earnings per share came to $2.92, beating the FactSet consensus of $1.98. Sales grew 7.3% to $2.50 billion, above the FactSet consensus of $2.38 billion, as same-store sales growth of 7.5% beat expectations of a 2.7% rise. So far in the third quarter, the company said it continues to see “strong growth” in do-it-yourself channels and positive same-store sales in the professional channel. “Without question, we benefited from a surge in industry demand in the quarter fueled by the government stimulus, unemployment benefits and the impact COVID-19 had on consumer behavior in terms of how they repaired and maintained their vehicles,” said Chief Executive Tom Greco. The stock has edged up 0.5% year to date through Monday, the S&P 500 has gained 4.7%.
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