Advance Auto Parts, Inc. (AAP) Valuation

Valuation

Model-based estimates, not advice. The DCF is the discounted-cash-flow value per share; compare it with the price, not as a target.

DCF fair value

-51.3%

$22.93

vs $47.04 price

Levered DCF

$6.80

After debt service

Piotroski score

6 / 9

Average

Altman Z-score

1.78

Distress zone

Rating

C+

Overall 2 / 5

Ratios by fiscal year

Margins and yields are shares of revenue, equity or price; multiples are ×.

Metric	FY2025	FY2024	FY2023	FY2022	FY2021	FY2020	FY2019	FY2018
P/E	53.27×	-7.83×	122.06×	19.09×	24.94×	21.97×	23.05×	27.04×
P/B	1.06×	1.21×	1.44×	3.41×	4.91×	3.04×	3.16×	3.23×
P/S	0.27×	0.29×	0.39×	0.97×	1.4×	1.07×	1.16×	1.2×
EV / EBITDA	13.85×	-11.25×	22.47×	16.14×	16.78×	13.76×	14.81×	13.66×
Gross margin	43.4%	37.5%	41.9%	46.3%	44.8%	44.3%	43.8%	44.0%
Operating margin	1.9%	-4.4%	0.6%	5.7%	7.5%	7.4%	7.0%	6.3%
Net margin	0.5%	-3.7%	0.3%	5.1%	5.4%	4.9%	5.0%	4.4%
Current ratio	1.75×	1.32×	1.2×	1.11×	1.21×	1.32×	1.27×	1.57×
Debt / equity	2.38×	1.7×	1.52×	1.4×	1.08×	0.86×	0.78×	0.29×
Interest coverage	1.16×	-4.99×	0.63×	10.32×	21.76×	15.99×	16.97×	10.68×
Dividend yield	2.6%	2.3%	5.8%	3.8%	1.0%	0.5%	0.2%	0.2%
Payout ratio	136.4%	-17.8%	697.6%	72.4%	27.0%	11.4%	3.5%	4.2%

Key metrics by fiscal year

Metric	FY2025	FY2024	FY2023	FY2022	FY2021	FY2020	FY2019	FY2018
Return on equity	2.0%	-15.5%	1.2%	17.9%	19.1%	13.9%	13.7%	11.9%
Return on invested capital	-1.6%	-5.0%	0.5%	6.1%	8.9%	8.0%	7.6%	8.9%
Return on assets	0.4%	-3.1%	0.2%	3.9%	4.9%	4.2%	4.3%	4.7%
Free cash flow yield	-12.8%	-3.7%	1.7%	3.8%	5.3%	6.5%	3.5%	5.4%
Earnings yield	1.9%	-12.8%	0.8%	5.2%	3.9%	4.6%	4.3%	3.7%
Enterprise value	$4.4B	$4.4B	$7B	$12.3B	$18.1B	$13B	$13.6B	$11.6B
Net debt / EBITDA	6.57×	-4.6×	10.77×	4.45×	2.56×	2.33×	2.56×	0.18×
Cash conversion cycle (days)	66	35	49	81	70	85	94	105