A week ago we wrote an article examining the retail auto parts industry and why we think it's attractive. In short, the industry is resistant to disruption from online retailers such as Amazon (NASDAQ:AMZN) and will benefit from industry consolidation and an aging vehicle fleet. We recently initiated a position in Advance Auto Parts (NYSE:AAP) in our dividend portfolio. It barely pays a dividend, so it's an unconventional pick, but it will make sense by the end of this article.
Our investment thesis on the attractiveness of the auto parts retail sector isn't exactly groundbreaking news. As you can see in the table below, the four major auto parts stores aren't trading at levels anyone would call cheap.
