Jul. 1 at 8:45 PM
Moody's Ratings revised Advance Auto Parts' outlook to stable from negative while affirming its Ba3 corporate family rating and Ba3-PD probability of default rating. The agency also affirmed the company's senior unsecured debt ratings and upgraded its speculative-grade liquidity rating to SGL-1 from SGL-2, citing improved liquidity and progress in its turnaround.
Moody's said the restructuring is largely complete, with only limited charges expected in 2026, and forecasts positive free cash flow this year along with stronger credit metrics over the next 12 months. Advance Auto Parts ended the first quarter with
$2.9 billion in cash, maintains a
$1 billion asset-based revolving credit facility, has suspended share repurchases, and continues to pay a reduced dividend. Moody's expects adjusted debt-to-EBITDA to improve to 4.6x and EBITA-to-interest coverage to 2.4x in 2027, supported by favorable U.S. auto aftermarket trends, including an aging vehicle fleet.
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