Advance Auto Parts, Inc.
The law firm of Kirby McInerney LLP announces that a class action lawsuit has been filed in the U.S. District Court for the Eastern District of North Carolina on behalf of those who acquired Advance Auto Parts, Inc. (“AAP” or the “Company”) (NYSE: AAP) securities during the period from November 16, 2022 through May 30, 2023, inclusive (the “Class Period”). Investors have until December 8, 2023 to apply to the Court to be appointed as lead plaintiff in the lawsuit.
On May 31, 2023, AAP held its quarterly earnings call for 2023 first quarter. During that call, President and CEO Thomas R. Greco conceded, "our financial results in the first quarter were well below expectations." Because the Company slashed prices on products, Greco stated the Company "had less price realization than plans, which put substantially higher pressure on our product margin price." Executive Vice President and Chief Financial Officer, Jeffrey W. Shepherd revealed during the May call that the Company's strategic pricing program resulted in the Company being "unable to price to cover product costs in the quarter." The Company consequently revised downward its 2023 guidance to an operating margin of 5% to 5.3% from the previously announced 7.8% to 9.2% margins. On this news, the price of AAP shares declined by $39.31 per share, or approximately 35.04%, from $112.20 per share to close at $72.89 on May 31, 2023.
The lawsuit alleges that, throughout the Class Period, Defendants made false and/or misleading statements, as well as failed to disclose that: (i) APP misrepresented the efficacy of the Company's strategic pricing initiative and the impact of price reductions; (ii) AAP omitted and/or concealed the negative impacts of the pricing initiative; (iii) AAP provided investors with an overly optimistic perception of the Company's operations; and (iv) the Company created the false impression that inflation and macroeconomic factors had an insubstantial impact on the Company's margins.
On May 31, 2023, AAP held its quarterly earnings call for 2023 first quarter. During that call, President and CEO Thomas R. Greco conceded, "our financial results in the first quarter were well below expectations." Because the Company slashed prices on products, Greco stated the Company "had less price realization than plans, which put substantially higher pressure on our product margin price." Executive Vice President and Chief Financial Officer, Jeffrey W. Shepherd revealed during the May call that the Company's strategic pricing program resulted in the Company being "unable to price to cover product costs in the quarter." The Company consequently revised downward its 2023 guidance to an operating margin of 5% to 5.3% from the previously announced 7.8% to 9.2% margins. On this news, the price of AAP shares declined by $39.31 per share, or approximately 35.04%, from $112.20 per share to close at $72.89 on May 31, 2023.
The lawsuit alleges that, throughout the Class Period, Defendants made false and/or misleading statements, as well as failed to disclose that: (i) APP misrepresented the efficacy of the Company's strategic pricing initiative and the impact of price reductions; (ii) AAP omitted and/or concealed the negative impacts of the pricing initiative; (iii) AAP provided investors with an overly optimistic perception of the Company's operations; and (iv) the Company created the false impression that inflation and macroeconomic factors had an insubstantial impact on the Company's margins.