Q: ATD has gone from $86 to $75. Is it time to buy the dip?
5i Research Answer:
ATD’s share price was under pressure recently after the company released earnings which missed both top and bottom lines, EPS of $0.65 missed estimates of $0.84; Revenue of $19.62B missed estimates of $20.85B, largely due to fuel margins. ATD is a high-quality, predictable business, which occasionally missed earnings in the past and has always recovered. We are seeing some signs of a consumer slowdown in other companies as well, but we think ATD’s fundamental remains attractive and its track record of value creation and solid management execution are still there. We are okay to add at the current prices.