Is It Overvalued? Look at the P/S Ratio: Advance Auto Parts, Inc. (AAP), LKQ Corporation (LKQ)

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Advance Auto Parts, Inc. (NYSE:AAP) shares were trading higher by 0.17 percent ($0.17) at $99.5 a piece in Thursday’s session. It had closed the previous session at $99.33. AAP trades with a P/S ratio of 0.77. This is lower than the both industry’s 91.03 and the wider sector’s 13.51. A low price-to-sales ratio, typically less than 1.0, is considered a good value. Also, it has an estimated price-earnings (P/E) multiple of 16.23 and a trailing 12-month price-earnings (P/E) multiple of 19.87. Shares of AAP have downtrended -14.26% in the past three months, while the S&P 500 has moved -17.14% in that time. Advance Auto Parts, Inc. (AAP) has a market cap of $7.35 billion and over the last 12 months, Advance Auto Parts, Inc. (NYSE:AAP) has gone weaker by -33.22%. During the last 52 weeks, the (NYSE:AAP) price has been as high as $177.83 and as low as $82.21. Advance Auto Parts, Inc. earnings have risen with an annualized rate of 3.9% over the last 5 years.

Advance Auto Parts, Inc. (Mean Target Price: $103.93)

The average 1-year price target for Advance Auto Parts, Inc. (AAP) — averaging the work of different analysts — reveals a mean PT of $103.93/share. That’s a potential 4.45 increase relative to where Advance Auto Parts, Inc. (NYSE:AAP) has been trading recently. The current price is seen ranging between $98.91 and $99.92. There are brokerage firms with lower targets than the average, including one setting a price target of $82. And then on the other side of the spectrum one analyst entrenched in the bullish camp has a target as high as $154.

Advance Auto Parts, Inc. (AAP) Consensus Recommendation

The collective rating of 2.5 for Advance Auto Parts, Inc. (NYSE:AAP) also leans strongly towards the neutral end of the spectrum. Of the 26 analysts surveyed by Reuters that track AAP 9 of them rate its stock a hold. The other 17, though not evenly; between analysts who think you should buy Advance Auto Parts, Inc. versus those who think you should sell it. A 14 analysts rate it as either a buy or a strong buy, while3 believe that investors should either steer clear of AAP or, if they already own its stock, sell it.

Is LKQ Corporation (NASDAQ:LKQ) Cheap From Peers?

LKQ Corporation (LKQ) pulled off a 0.17 percent gain and now trades for $35.75. LKQ comes in with a P/S ratio of 1.22 that’s greater than 1, potentially implying that it could be expensive relative to the overall sector (13.51) and its peers (91.03). Also, it has an estimated price-earnings (P/E) multiple of 16.85 and a trailing 12-month price-earnings (P/E) multiple of 22.5. During the last 52 weeks, the price has been as high as $35.86 and as low as $27.85. LKQ Corporation (NASDAQ:LKQ) earnings have risen with a quarterly rate of 21.3% over the last 5 years. Shares of LKQ have increased 9.49% in the past three monthswhile the S&P 500 has gained 7.27% in that time.

LKQ Corporation (Price Objective: $38.33)

LKQ Corporation (NASDAQ:LKQ) has a market cap of $11.03 billion and over the last 12 months, LKQ has risen by 0.65%. The average 1-year price target for (LKQ) reveals an average price target of $38.33 per share. That’s a potential 7.22 gain from where (NASDAQ:LKQ) has been trading recently. There are brokerage firms with lower targets than the average, including one setting a price target of $34. And then on the other side of the spectrum one analyst entrenched in the bullish camp has a target as high as $41.

Analyst Thoughts About LKQ Corporation (NASDAQ:LKQ)

The consensus recommendation — averaging the work of 13 analysts — of 1.6 for LKQ Corporation (LKQ) points to bullish case. Of the analysts surveyed by Reuters that track LKQ Corporation 1 of them rate its stock a hold. The other 12 are split, though not evenly, between analysts who think you should buy its stock versus those who think you should sell it. A 12 analysts rate it as either a buy or a strong buy, while 0 believe that investors should either steer clear of (NASDAQ:LKQ) or, if they already own its stock, sell it.

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