Auto Parts Retailer Sent To Junkyard

One of these auto parts retailers is not like the other… 🤔

The troubles at Advance Auto Parts continue, with S&P Global Ratings downgrading the retailer’s credit rating to ‘junk’ status. The rating agency cut its issuer-credit rating to BB+, the highest speculative-grade rating. The downgrade from BBB- was accompanied by its outlook being cut from stable to negative. ⚠️

As for why it downgraded the company, S&P cited inconsistent execution in improving its inventory and product availability. Its ‘misguided strategic decision’ to try to preserve and expand its margins while competitors cut prices caused the company to lose already dwindling market share. Its revenue growth is flat YoY, while its peers have seen low-teen percentage growth.

Overall, its competitive standing in the industry has weakened due to major operational missteps that will take several quarters (or years) to address properly. 🗓️

While the downgrade pressured the stock further today, it likely didn’t come as a major surprise to anyone following the auto parts retailer space. Advance Auto Parts has lagged competitors AutoZone and O’Reilly Automotive for about eight years, with performance really diverging at the beginning of 2022. 😮

The news sent $AAP shares down 8% to 12-year lows as market participants look to salvage what’s left of their ‘junky’ investment. Today’s move brings the stock’s year-to-date return to -60%, with no turnaround in sight. 😬

Pfizer’s Flop Continues

It’s been a rough ride for pharmaceutical giant Pfizer since the end of the pandemic, and that rollercoaster ride continues today. 🎢

The company last announced earnings in October but needed to update Wall Street on its 2024 forecast. It cited weak demand for its Covid products as the reason for a weaker-than-anticipated revenue and earnings forecast.

Read It

Investors Are Losing Trust

It’s been a rough eighteen months or so for real estate investment trusts (REITs), with higher interest rates giving investors alternative sources of yield and pressuring commercial real estate’s asset values. Unfortunately for Medical Properties Trust (MPT), that pain continues today, with its shares falling back to their Great-Financial-Crisis lows. 😬

The medical-related real estate property operator revealed to investors that one of its tenants, Steward Health Care System, is roughly $50 million behind in rent payments. As a result, MPT will take a $225 million noncash charge to write off rent receivables and other items. 

Read It

FanDuel Parent Lists On NYSE

The U.S. “degenerate economy” is getting its latest entrant, with FanDuel parent company Flutter Entertainment making its debut on the New York Stock Exchange (NYSE) today. 🤩

With that said, the company did not receive the traditional fanfare it would in a standard initial public offering (IPO). That’s because it was listed on the London Stock Exchange (LSE) in May 2019, and its American depository receipts (ADR) have traded over the counter under the ticker $PDYPY for years.

Read It

JetBlue Jumps As Icahn Accumulates

It’s been a rough few months for JetBlue shareholders after the airline’s merger with Spirit Airlines was blocked by U.S. regulators. However, the stock is popping after hours on news that a billionaire hedge fund manager is dumpster diving and sees value in the stock. 💸

Activist investor Carl Icahn reported a nearly 10% stake, which he’s accumulated on the belief that the stock is undervalued following its recent selloff. He’s already had discussions with the company regarding possibly attaining board representation.

Read It