U.S. Auto Parts Network (NASDAQ: PRTS) and Advance Auto Parts (NYSE:AAP) are both retail/wholesale companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, dividends, institutional ownership, valuation, earnings, risk and analyst recommendations.
Risk and Volatility
U.S. Auto Parts Network has a beta of 1.49, suggesting that its stock price is 49% more volatile than the S&P 500. Comparatively, Advance Auto Parts has a beta of 0.87, suggesting that its stock price is 13% less volatile than the S&P 500.
Earnings & Valuation
This table compares U.S. Auto Parts Network and Advance Auto Parts’ top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|U.S. Auto Parts Network||$303.66 million||0.30||$8.58 million||$0.64||4.14|
|Advance Auto Parts||$9.48 billion||0.84||$1.01 billion||$5.51||19.48|
Advance Auto Parts has higher revenue and earnings than U.S. Auto Parts Network. U.S. Auto Parts Network is trading at a lower price-to-earnings ratio than Advance Auto Parts, indicating that it is currently the more affordable of the two stocks.
This table compares U.S. Auto Parts Network and Advance Auto Parts’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|U.S. Auto Parts Network||8.41%||6.64%||1.79%|
|Advance Auto Parts||4.31%||16.02%||5.51%|
Institutional & Insider Ownership
69.0% of U.S. Auto Parts Network shares are held by institutional investors. 40.7% of U.S. Auto Parts Network shares are held by insiders. Comparatively, 4.5% of Advance Auto Parts shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Advance Auto Parts pays an annual dividend of $0.24 per share and has a dividend yield of 0.2%. U.S. Auto Parts Network does not pay a dividend. Advance Auto Parts pays out 4.4% of its earnings in the form of a dividend.
This is a breakdown of recent ratings and recommmendations for U.S. Auto Parts Network and Advance Auto Parts, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|U.S. Auto Parts Network||0||0||1||0||3.00|
|Advance Auto Parts||3||6||12||1||2.50|
U.S. Auto Parts Network currently has a consensus target price of $4.00, indicating a potential upside of 50.94%. Advance Auto Parts has a consensus target price of $145.53, indicating a potential upside of 35.58%. Given U.S. Auto Parts Network’s stronger consensus rating and higher probable upside, analysts plainly believe U.S. Auto Parts Network is more favorable than Advance Auto Parts.
Advance Auto Parts beats U.S. Auto Parts Network on 9 of the 17 factors compared between the two stocks.
About U.S. Auto Parts Network
U.S. Auto Parts Network, Inc. is an online provider of automotive aftermarket parts and repair information. The Company is an online provider of aftermarket auto parts, including collision parts, engine parts, and performance parts and accessories. The Company operates through two segments: Base USAP, which is an auto parts business, and AutoMD, an online automotive repair source. The Company’s Websites provide customers with a range of stock keeping units (SKUs) with detailed product descriptions, attributes and photographs. The Company’s product database maps its SKUs to product applications based on vehicle makes, models and years. The Company primarily sells its products to individual consumers through its network of Websites and online marketplaces. The Company classifies its products into various categories, including collision parts serving the body repair segment, engine parts to serve the replacement/wear parts market, and performance parts and accessories.
About Advance Auto Parts
Advance Auto Parts, Inc. provides automotive aftermarket parts in North America, serving do-it-for-me (Professional) and do-it-yourself (DIY), customers. The Company’s stores and branches offer a selection of brand name, original equipment manufacturer (OEM) and private label automotive replacement parts, accessories, batteries and maintenance items for domestic and imported cars, vans, sport utility vehicles and light and heavy duty trucks. It serves through various channels ranging from traditional brick and mortar store locations to self-serving e-commerce sites. As of December 31, 2016, it operated 5,062 total stores and 127 branches primarily under the trade names Advance Auto Parts, Autopart International, Carquest and Worldpac. As of December 31, 2016, its Advance Auto Parts operations consisted of three geographic divisions, which included the operations of the stores operating under the Advance Auto Parts, Carquest and Autopart International trade names.
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