TIL: Auto Parts Store Stocks

"Sn210" (sn210) 09/16/2015 at 11:57 • Filed to: Stocklopnik

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I was Googling where the closest AutoZone was to run to at lunch when I noticed their stock ticker in the results. Holy crap, $730/share?!?! And they were trading for $200 just 5 years ago? Damn.

Other stores are up there too...

Well except for Pep Boys

Ash78, voting early and often > Sn210 09/16/2015 at 12:03

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The actual share price is mostly meaningless, but I think optically it’s time for a split. If their investors are mostly institutional, it’s purely about valuation and not the share price itself — they buy block of thousands or millions at a time. The only real reason to artificially force the price down is to get more mom & pop investment.

On the other hand, stocks can be fairly valued under $10 and the company might be perfectly profitable, but they’d be at risk of being de-listed from their exchange.

Those are about the only two reasons to care about share price.

Just look at Warren Buffet’s Berkshire Hathaway shares:

$200,000 per share for “A” shares

$132 for “B” shares

RustedSprinter > Sn210 09/16/2015 at 12:03

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Pep boys is only 11 bucks a share? Wow

jariten1781 > Sn210 09/16/2015 at 12:08

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But that’s only half the cost of Priceline (share prices baffle me).

If only EssExTee could be so grossly incandescent > Sn210 09/16/2015 at 12:10

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NAPA’s price is just about $86 right now.

Sn210 > Ash78, voting early and often 09/16/2015 at 12:11

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Yeah I know it's not always a good investment just because it's expensive, but still I wasn't expecting them to be that high

Sn210 > jariten1781 09/16/2015 at 12:11

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You and me both

Sn210 > If only EssExTee could be so grossly incandescent 09/16/2015 at 12:12

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See that's the range I would have guessed they'd all be.

Ash78, voting early and often > Sn210 09/16/2015 at 12:15

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The investment is equally good (or bad) whether it’s 1 share at $780 or 100 shares at $7.80

Share price means nothing unless you look at it against P/E or P/FCF or something like that. Only the multiple counts.

Mr. Ontop, No Strokes, No Smokes...Goes Fast. > Ash78, voting early and often 09/16/2015 at 12:40

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I’m too lazy to run the numbers. How does their price do when P/E is reflected?

SidewaysOnDirt still misses Bowie > Sn210 09/16/2015 at 13:09

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I don’t believe for a minute that some of these valuations are real. It seems like mergers and cost cuts have been the drivers for the last few earnings seasons, which isn’t sustainable and their P/E ratios are at tech levels. Sorry, but Advanced Auto Parts isn’t a $15bil company. It’s just not.

SidewaysOnDirt still misses Bowie > Sn210 09/16/2015 at 13:15

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The prices don’t really matter as they’re divided by the number of shares to show the valuation of the company. A company can have a $1000 share price and be worth less than something with a $5 share price if there aren’t enough shares. For example, AAP is at $178 with a market cap roughly $15bil while Ford is sitting at $15 per share with a market cap of about $60bil or worth four times as much. The reason is that there are 4 billion Ford shares while there are only 73 million shares of Advanced auto parts out.

Ash78, voting early and often > Mr. Ontop, No Strokes, No Smokes...Goes Fast. 09/16/2015 at 13:28

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I’m lazy, too — the screencap shows a P/E of 21, which isn’t far from the long-term historical market norm of (I think) 15. Tech stocks are often valued more highly due to growth prospects, but 21 for a retailer isn’t crazy at all. Nothing to see here :D