Pep Boys Still Needs a Tune-Up
But it hasn't always been its fault. Given the lackluster results from rivals Advance Auto Parts
I won't deny that after a couple of tune-ups, management had made meaningful progress. But I'm still concerned by the air being sucked out of the company's operating model. Not to mention, Wal-Mart
However, with shares of Pep Boys now up more than 22% year to date, the Street assumes the company will eventually get its house in order. But that has always been a big bet. It's not the first time investors have chosen a favorite, even if the business model looks flawed. But Pep Boys, which has become a perpetual turnaround story for 15 years, no longer deserves the type of pass that it has gotten.
After what was another disastrous quarter, during which the company missed on both revenue and earnings, I have to wonder if investors, who have shown incredible faith in this company, are not being taken for a ride. Bulls will likely disagree. Look, I appreciate that the U.S. is still dealing with some economic challenges -- many of which have adversely impacted not only Pep Boys' operation, but that of other retailers.
To that end, as with Wal-Mart and McDonald's