Advance Auto Parts, Inc. (AAP): The Best Company to Maintain Your Portfolio

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AutoZone, Inc. (NYSE:AZO) has total debt of $4 billion versus just $133.68 million in cash. And that really reduces its book value per share.  Obviously, this is a big problem.  If things start to go against the industry, AutoZone may have trouble covering its debt load.  This is a big issue when considering a stock for investing.

Foolish takeaway

Both Advance Auto Parts, Inc. (NYSE:AAP) and O’Reilly Automotive Inc (NASDAQ:ORLY) boast strong financials while AutoZone, Inc. (NYSE:AZO) has a pile of debt to deal with.  On the surface, Advanced Auto Parts appears to be cheaper than O’Reilly Automotive, despite its higher operating margin and larger store base.

Ultimately, Advanced Auto Parts seems a better bet as its cheaper and its growth prospects are in line with that of O’Reilly Automotive Inc (NASDAQ:ORLY).  As the automobile industry continues to rebound, so too should businesses that operate in the auto part industry. So perhaps you should take a look at Advance Auto Parts, Inc. (NYSE:AAP), of the three, its the best in class.

harsha lohia has no position in any stocks mentioned. The Motley Fool owns shares of O’Reilly Automotive.

The article The Best Company to Maintain Your Portfolio originally appeared on Fool.com.

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