November 2022 Advanced Auto Parts (AAP) and Bear Fight Whiskey Pairing

Advanced Auto Parts

(AAP)

November 2022

Authors: James Hatfield, Allan Maule

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Website: advanceautoparts.com

Twitter: @AdvanceAuto

CEO: Thomas Greco

Founders: Arthur Taubman

Market Cap at Time of Article: $11.42B

Current Analyst Recommendations: We see AAP as a buy with a current stock price of $189.92 and a median analyst target price of $204.67 (taken from 27 analysts). Among 27 analysts, 2 gave it a “sell,” 1 gave it an “underperform,” 11 gave it a "hold," 9 gave it a "buy," and 4 gave it an "outperform."

Quarterly Revenue Growth Year-Over-Year: 0.6%, which isn't great, but annual revenues are growing by nearly 10%.

Insiders: 0.78%, which is also not a great percentage of insiders. Despite this, Advance Auto Parts is a company that has been around since 1932, and its current price point makes it a solid addition to your portfolio for the long haul.

What makes Advance Auto Parts (AAP) worth your hard-earned money for the next decade or more?

During this past year, we have seen the stock market take a hard correction due to inflation. Advance Auto Parts (AAP) has our eye because of the rising rates of loans.  Getting a new or used car comes with a higher level of interest and, therefore, a larger car payment. We see fixing and maintaining a car will continue to grow rather than switching a car out for the latest model. Car maintenance will continue to be common, and AAP is here to help.  From an investor standpoint, AAP comes with a dividend.  AAP is paying a 3.15% yield, and it’s growing its dividend at a rapid pace.  Their dividend is very safe, it’s been paying a dividend for the last 15 years, and for the last two years, they have raised their dividend.  If AAP stopped paying a dividend, we would sell the stock.  We are looking for years of dividend growth and stock growth from AAP. We are using the dividends to reinvest in key stocks; we don’t necessarily just use the dividend to buy more of the same stock.

Why talk about Advance Auto Parts (AAP) to all your friends and family?

Advance Auto Parts (AAP) is something you may start to hear more from family and friends as people take care of their automobiles to have them last longer. Turning to more challenging economic times, people will start to watch their spending a bit more and find ways to save on monthly bills. Not all auto care is difficult, and Advance Auto Parts has a wide distribution to put parts and supplies in consumers' hands.

We also think this is a stock worth talking to family and friends about because it’s time to start adding strong dividend growth stocks to your portfolios. We want to challenge our readers to spend time researching dividend stocks like AAP as we add a dividend growth portfolio to our holdings.

How is this asset disruptive?

We think the disruption comes from people starting to take care of their vehicles a bit more because of increased economic pressure. There was a time when people spent more time caring for their cars and fixing things like a new car battery that can easily be fixed at Advance Auto Parts. We also see other activities like washing your own car becoming more popular in economically stressful times. This is not disruptive as a new technology, but we think human behavior changes in different economic environments.

In addition, we also like that this company is disruptive to our portfolio because of adding a dividend-producing stock. Last month, we recommended Starbucks (SBUX) as a dividend growth stock to our overall portfolio. Disruption can come in multiple forms as we grow our holdings.

Conclusion:

So, changing your windshield wipers, changing your oil, washing your car, and the many other self-service things that consumers can do to save money may not be extremely exciting. But Advance Auto Parts (AAP) is a company we can see sticking around for decades; a growing dividend and a market cap that has the potential to grow adds stability to our portfolio.  We are excited to be grabbing shares of AAP in November.

Bear Fight – American Single Malt Whiskey

Proof: 90  Price: $40

We know what it’s like to be afraid. As we face market headwinds, political tumult, and watching beloved growth stocks shrink like they just got out of the pool, it’s easy to give into fear. Fear makes us not nibble at underpriced stocks. It makes us settle for whiskey we only kind of like. When we’re afraid, we (and our portfolios of stock and spirit alike) are a shadow of what they could be.

Or we can fight.

It’s time to stare down the bear market and dare it to do its worst. Buy the stocks you believe in at prices you won’t see for years. Invest in the future instead of worrying about the present. And when the bears loom large, choose violence.

That’s why November’s whiskey pick is Bear Fight Single Malt. Distilled in Wealth and Whiskey’s home state of North Carolina, Bear Fight has already won a host of awards, including a double gold medal at the 2021 New York International Spirits competition. The distiller also recently signed Family Guy frontman Seth MacFarlane as their lead storyteller, so we knew this was a whiskey to watch even before we sipped it. So let’s get our claws out and dig in.

Nose:

They made Bear Fight to be a crowd-pleaser. It has some gentle peat smoke for Scotch lovers and is aged in bourbon barrels to give it sweetness. I notice whiffs of baking sugar cookies laden with candied pecans and served next to honeysuckle flowers.

Taste:

I find honey flavor here that reminds me fondly of Tennessee whiskies like Jack Daniel’s. Bear Fight gives you a wholesome dessert for the tongue, with traces of fig and candied dates.

Finish:

The peat smoke gently returns alongside sherry smoothness. This is a young whiskey (3 years), so the finish isn’t as dominant as some of our favorites. Still, I find the balance and fullness of Bear Fight to be punching above its weight.

Overall Rating: 4/5

Definitely recommend Bear Fight, as there’s much here for any whiskey lover to appreciate. I’d encourage you to give this spirit a few tries, as I was more impressed with the flavors after my first dram. Again, this is a young whiskey, so it’s more subtle than many that we recommend. Bear Fight is a spirit I predict will be much more popular over time, as its price point and crowd-pleasing nature should make it a staple in countless whiskey cabinets for years to come.