Why is the Bapcor share price sinking on Tuesday?

The market is seemingly disappointed by an insight into the company’s recent performance.

| More on:
man bending over to look at red arrow crashing down through the ground

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Key points

  • The Bapcor share price is tumbling lower today, falling 4.5% to trade at $6.43 
  • The slump comes amid the release of a non-price sensitive update outlining the company's performance for financial year 2022 so far 
  • Over the first 9 months of this financial year, the company's revenue has increased 3% and it's still aiming for its pro forma earnings to be at least equal with those of last financial year 

The Bapcor Ltd (ASX: BAP) share price is tumbling lower amid confirmation of the company’s guidance for financial year 2022.

The company restated its outlook in its latest Macquarie Group Ltd (ASX: MQG) Investor Conference presentation, published in a non-price sensitive update this morning.

At the time of writing, the Bapcor share price is $6.43, 4.46% lower than its previous close.

For context, the S&P/ASX 200 Index (ASX: XJO) is also in the red today, having slumped 0.1%.

Let’s take a closer look at the vehicle parts, accessories, and services provider’s performance for the financial year so far.

Bapcor reports increased revenue for FY22 so far

The Bapcor share price is sliding amid the company’s latest trading and guidance update.

Bapcor has told the Macquarie Investor Conference its performance for financial year 2022 so far has been “strong” given the challenges it faced in the first half. It continued:

[The] fundamental drivers of the automotive aftermarket remain strong and are expected to continue to do so.

The company’s revenue for the first three quarters of financial year 2022 is 3% higher than it was at the same point of financial year 2021.

The boost has been driven by the company’s specialist wholesale segment. Its revenue has increased 8% this financial year. Meanwhile, Bapcor’s trade segment has seen its revenue rise 4% and its New Zealand segment’s revenue has grown 1%.

Those increases have counteracted a 4% revenue slip from Bapcor’s retail segment.

The company also provided a window into its performance for the quarter ended 31 March.

Over that period, Bapcor’s retail/online division outperformed, with its revenue increasing 39.7% compared to that of the third quarter of financial year 2021. Additionally, its trade/Burson segment and its specialist wholesale division’s revenue increased by 5.2% and 10.1% respectively.

Finally, Bapcor reiterated its previously given financial year 2022 guidance. It’s still aiming for its pro forma earnings to be at least in line with those of financial year 2021.

The company has stuck with that guidance since it released its most recent full year results in August.

Last financial year saw the company reporting pro forma earnings before interest, tax, depreciation, and amortisation (EBITDA) of $279.5 million and pro forma net profit after tax (NPAT) of $130.1 million.

Bapcor share price snapshot

This year so far has been tough on the Bapcor share price.

Today’s fall included, the company’s stock has slumped 9% year to date. It is also 15% lower than it was this time last year.

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Bapcor and Macquarie Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Consumer Staples & Discretionary Shares

Woman thinking in a supermarket.
Consumer Staples & Discretionary Shares

Can Coles shares deliver 13% growth AND tasty dividends this year?

We see what the experts are saying about the grocer's outlook.

Read more »

falling milk asx share price represented by frowning woman tasting sour milk
Consumer Staples & Discretionary Shares

The A2 Milk share price has had a tough week. Could this other ASX dairy company cash in?

This week delivered disappointing news for A2 Milk shareholders...

Read more »

two children squat down in the dirt with gardening tools and a watering can wearing denim overalls and smiling very sweetly.
Consumer Staples & Discretionary Shares

‘Back to a growth mindset’: Expert names ASX share ready to take off

In just two years this business overcame devastation and is now ready to grow again, reckons this fund manager.

Read more »

a happy woman wearing a white towel around her chest and another around her head laughs heartily while holding two slices of cucumber over her eyes as part of a beauty regime.
Consumer Staples & Discretionary Shares

Adore Beauty share price volatile following CEO resignation

Adore Beauty's CEO has called it time.

Read more »

A man looks sadly away from his computer screen as he holds a slice of pizza in his hand with an open pizza box in front of him on his desk.
Consumer Staples & Discretionary Shares

Is it a problem for shareholders that Italians don’t like Domino’s Pizza?

The pizza chain appears to have fizzled out in Italy.

Read more »

A group of people clink wine glasses in an outdoor, late afternoon setting to celebrate the rising Treasury Wine share price
Consumer Staples & Discretionary Shares

Treasury Wine share price up amid key China trademark win

Pop open the champagne bottle: the company just won a Chinese court case.

Read more »

a small girl sits with her hand holding up the side of her face as she looks down in a downcast manner as she drinks a glass of milk through a straw.
Consumer Staples & Discretionary Shares

Why is the A2 Milk share price spilling 8% today?

It's been a tough day for A2 Milk shareholders.

Read more »

A happy farmers sifts his fingers through grain, indicating a good crop and higher prices
Consumer Staples & Discretionary Shares

Why is the GrainCorp share price up 7% today?

The agribusiness has delivered good news to the market on Wednesday.

Read more »