Advance Auto Parts Inc. shares are surging as the aftermarket retailer said sales are getting a boost from Americans doing more work on their cars as they wait for shutdown orders to lift.
Comparable-store sales improved in the first four weeks of the second quarter and to date are in line with a year ago, the Roanoke, Virginia-based company said Tuesday. Advance Auto shares jumped as much as 9.5% before the start of regular trading.
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Americans have taken stay-home orders as a cue to do more wrenching on their rides, Advance Auto Chief Executive Officer Tom Greco said on the company’s earnings call. Its do-it-yourself repair business is strong, replacement car-battery sales are brisk and consumers are taking breaks from streaming to scrub down their vehicles.
“You’ve got people sitting in their homes and you can only watch so much Netflix," Greco said. “You decide what to do and you go outside maybe you fix something in your yard or maybe you work on your car."
The do-it-yourself segment tends to hold up well during economic downturns. As unemployment increases, new-car sales decline and the vehicle fleet ages, leading consumers to do more of their own maintenance. Greco also said that an aversion to mass transit and desire to drive rather than fly to vacation destinations may help Advance Auto sustain its recent momentum.
This story has been published from a wire agency feed without modifications to the text.