Advance Stock Story

AAP
 Stock
  

USD 173.64  0.55  0.32%   

Advance Auto is generating negative expected returns assuming volatility of 2.5869% on return distribution over 90 days investment horizon. As many conservative investors are still indifferent towards recent market risk, it is prudent, from our point of view, to recap Advance Auto's current volatility. We are going to focus on if the current expected returns justify Advance Auto's volatility. Advance Auto's low volatility may still impact the value of the stock as we estimate it as currently undervalued. The real value, based on our analysis, is getting close to 202.46 per share.
Published over a month ago
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Advance Auto Parts Current Investor Sentiment

Investor biases related to Advance Auto's public news can be used to forecast risks associated with investment in Advance. The trend in average sentiment can be used to explain how an investor holding Advance can time the market purely based on public headlines and social activities around Advance Auto Parts. Please note that most equiteis that are difficult to arbitrage are affected by market sentiment the most.
Advance Auto's market sentiment shows the aggregated news analyzed to detect positive and negative mentions from the text and comments. The data is normalized to provide daily scores for Advance Auto's and other traded tickers. The bigger the bubble, the more accurate is the estimated score. Higher bars for a given day show more participation in the average Advance Auto's news discussions. The higher the estimate score, the more favorable is the investor's outlook on Advance Auto.

Advance Auto Maximum Pain Price across 2022-07-15 Option Contracts

Advance Auto's options can also be used to analyze investors' bias and current market sentiment in the context of behavioral finance. For example, Max pain usually refers to a trading concept that asserts that market manipulation can cause the market price of Advance Auto close to the expiration of its current option contract to expire worthlessly. According to most research, about 35% of options are not executed, with roughly 50% traded out before expiration. So, Max pain occurs when market makers reach a net favorable position across all options at a strike price where option holders stand to lose the most money. By contrast, option sellers may reap the most after selling more options than buying, causing them to expire worthlessly. Please continue to view the detailed analysis of Advance Auto's options.
Is Advance Auto (NYSE:AAP) a good hedge for your existing portfolios?
Advance Auto Parts has roughly 601.43 M in cash with 1.11 B of positive cash flow from operations. This results in cash-per-share (CPS) ratio of 9.93.
Volatility is a rate at which the price of Advance Auto or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Advance Auto may increase or decrease. In other words, similar to Advance's beta indicator, it measures the risk of Advance Auto and helps estimate the fluctuations that may happen in a short period of time. So if prices of Advance Auto fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.

How important is Advance Auto's Liquidity

Advance Auto financial leverage refers to using borrowed capital as a funding source to finance Advance Auto Parts ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Advance Auto financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Please check the breakdown between Advance Auto's total debt and its cash.

What do experts say?

Stock analysis is a method for investors and traders to make buying and selling decisions. By studying and evaluating past and current data, investors and traders attempt to gain an edge in the markets by making informed decisions.
It is good to see analyst projects for Advance Auto, but it might be worth checking our own buy vs. sell analysis

Advance Auto Volatility Drivers

Advance Auto unsystematic risk is unique to Advance Auto Parts and usually not directly affected by the market or economic environment. An example of unsystematic risk is the possibility of poor earnings or a layoff due to coronavirus. One may mitigate nonsystematic risk by buying different securities in the same industry or by buying in different sectors. For example, if you have a position in Advance Auto you can also buy McDonalds Corp. You can also mitigate this risk by investing in the specialty retail sector as well as in companies having nothing to do with it. This type of risk is also called diversifiable risk and can be understood from analyzing Advance Auto important indicators over time. Here we run a correlation analysis between relevant fundamental ratios over at least ten year period to find a relationship in the way they react to changes in Advance Auto income statement and balance sheet. Here are more details about Advance volatility.
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