Is Advance Auto Parts, Inc. overvalued or undervalued?

Jun 25 2025 08:27 AM IST
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As of February 26, 2025, Advance Auto Parts, Inc. is considered overvalued and risky, with a Price to Book Value of 1.43, a negative EV to EBITDA of -17.36, and a troubling ROCE of -20.49%, significantly underperforming its peers and showing a 1-year stock return of -21.03% compared to the S&P 500's 10.26%.
As of 26 February 2025, the valuation grade for Advance Auto Parts, Inc. has moved from very expensive to risky, indicating a significant shift in its perceived value. The company is currently assessed as overvalued. Key ratios highlight this situation: the Price to Book Value stands at 1.43, while the EV to EBITDA is notably negative at -17.36, and the ROCE is a concerning -20.49%.

In comparison to peers, RH has a P/E ratio of 28.41 and an EV/EBITDA of 12.30, while Academy Sports & Outdoors, Inc. is more attractively valued with a P/E of 7.69 and an EV/EBITDA of 5.32. The stark contrast in these metrics suggests that Advance Auto Parts, Inc. is not only underperforming relative to its peers but also reflects a broader trend of poor returns, with a 1-year stock return of -21.03% compared to the S&P 500's 10.26%.
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