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Investing.com - BMO Capital has raised its price target on Advance Auto Parts (NYSE:AAP) to $55.00 from $50.00 while maintaining a Market Perform rating on the auto parts retailer. The new target represents modest upside from AAP’s current price of $50.70, with shares having surged 45.29% over the past year according to InvestingPro data.
The firm noted that Advance Auto Parts benefited from tariff price inflation in the third quarter of 2025, a trend the company expects to accelerate in the fourth quarter before stabilizing sometime after the first quarter of 2026. This pricing advantage comes despite the company’s overall revenue declining by 4.85% over the last twelve months.
BMO Capital acknowledged that Advance Auto Parts continues to make good progress on its turnaround plan, but emphasized that the initiative remains in the very early stages. InvestingPro data shows the company posted a diluted EPS of -$9.97 over the last twelve months, though analysts forecast a return to profitability with EPS of $1.75 for fiscal year 2025.
The firm cited lingering uncertainty around consumer health and potential impacts from price inflation on demand as factors in its decision to maintain a Market Perform rating despite the price target increase.
BMO Capital’s new $55 price target is supported by its newly established fiscal year 2027 estimates for the auto parts retailer.
In other recent news, Advance Auto Parts reported its third-quarter 2025 earnings, with adjusted earnings per share (EPS) of $0.92, surpassing the consensus estimate of $0.76. The company posted revenue of $2 billion, which was slightly below the forecasted $2.02 billion. Comparable sales growth was reported at 3.0%, exceeding the expected 2.5%. CFRA upgraded Advance Auto Parts from a Sell to a Hold rating, citing improved liquidity and a stronger structural position under CEO Shane O’Kelly. The firm also raised its price target for the company to $55.00 from $40.00. Meanwhile, BofA Securities maintained its Underperform rating but increased its price target to $40.00 from $34.00, following the company’s earnings report. These developments reflect the company’s efforts to strengthen its financial standing and operational performance.
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