The harsh winter weather appears to have created a pickup in demand at auto parts retailers and service centers.
Sector movers: Pep Boys (PEP) +4.2%, AutoZone (AZO) +5.2%, U.S. Auto Parts (PRTS) +1.2%, LKQ Corporation (LKQ) +3.2%, Genuine Parts (GPC) +3.0%, Monro Muffler (MNRO) +2.7%, Lithia Motors (LAD) +3.8%, Sonic Automotive (SAH) +2.0%.
Monro Muffler (MNRO +2.8%), which is in the midst of an impressive two-day, post-earnings rally (now at ~11%), gets a lift from a price target hike to $63 from $45 at Stifel Nicolaus which came away from a management presentation impressed: "Comp is running +3% quarter-to-date and is expected in the +2.5-4.5% range for the full year (well ahead of our -1% expectations), GM will run flat to slightly negative in the year ahead (a little lower than our model), and SG&A leverage will run in the 100-150 bp Y/Y range (ahead of our model)." Stifel also ups its FY14 and FY15 EPS estimates on expectations of a "leverage pop."
Monro Muffler Brake (MNRO) declares $0.11/share quarterly dividend, 10% increase from prior dividend of $0.10. Forward yield 0.99%. For shareholders of record May 31. Payable June 11. Ex-div date May 29. (PR)
More on Monro Muffler's (MNRO) FQ4: It looks like Northcoast Research was a bit too optimistic in its EPS call for MNRO, as earnings are in-line with Street expectations (which, at $0.25, were still at the high end of guidance). Nonetheless, revenue beat expectations, rising 14.1% Y/Y and comps growth wasn't as negative as the company originally forecast, coming in at -5.6% (adjusted) versus estimates of between -9% and -6%. Gross margins shrunk 270bps, and operating income fell 11.4%. Outlook: FY14 sales of $840-865, EPS of $1.65-1.80 versus consensus of $865.39 and EPS of $1.78. (PR)
Monro Muffler (MNRO +2.3%) trades higher after Northcoast Research says Q4 EPS will be better than analysts are anticipating thanks to a spate of winter storms which took their toll on vehicles. Additionally, foot traffic was up in February as customers received their tax returns.
Monro Muffler Brake Inc provides automotive undercar repair and tire services in the United States. The Company has a chain of 953 Company-operated stores three franchised locations and 14 dealer-operated stores.