The Dividend Daily

Auto parts retailer Advance Auto Parts, Inc. (AAP) late Wednesday said that its third quarter profit rose 10% from last year, helped by higher sales due to more stores being open.

The Roanoke, Virginia-based company reported third quarter net income of $62 million, or 65 cents per share, compared with $56.2 million, or 58 cents per share, in the year-ago period. Excluding one-time items, adjusted profit was 69 cents per share. On average, Wall Street analysts expected a lower profit of 66 cents per share.

Sales rose 6.3% from last year, to $1.26 billion.

The company benefited from the addition of 66 new stores in the past year, which helped bolster its sales results. Same-store sales also rose, however, by 4.7%. Same-store sales are a key metric used to measure a retailer’s health, since they measure the performance of stores open at least one year.

Advance Auto Parts shares were mostly flat in premarket trading Thursday.

The Bottom Line
We removed shares of AAP from our “recommended” list on Apr.17, when the stock was trading at $43.54. The company has a dividend yield of .60%, based on last night’s closing stock price of $40.28. The stock has technical support in the $36-$37 price area. If the shares can rebound from today’s sell-off, we see overhead resistance around the $45 price level. We would remain on the sidelines for now.

Advance Auto Parts, Inc. (AAP) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.4 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks, as well as a detailed explanation of our ratings system here.