Earnings Preview: Pep Boys (PBY)

The Pep Boys-Manny, Moe & Jack PBY is currently lower on the session by 0.60%, trading at $9.99. The company is scheduled to report earnings September 8th, after the close. • Estimates The Street is looking for Q2 earnings per share of $0.19 on revenue of $504.50 million. These estimates have fallen by $0.01 (-5.0%) over the past 90 days. The Whisper number for PBY is $0.19. • Guidance The Street is looking for Q3 EPS of $0.08 on revenue of $489.23 million. The full year 2011 estimates are $0.58 per share on revenue of $1.98 billion; FY 2012 is at $0.74 per share on revenues of $2.09 billion. • Technical Picture PBY has been consolidating around the 50-day moving average for the past three months after a sharp slide lower in May and June, when the stock was trading above $13.00. On a near-term basis, the chart looks quite constructive. • Volatility Both historical volatility and implied volatility have been down-trending over the past few months after a spike higher in mid-May. Currently HI is at 42% and IV is at 51%. The front month $10.00 straddle is trading at 61.83%; the October $10.00 straddle is trading at 49.56% The Pep Boys-Manny, Moe & Jack is an automotive service and retail chain. The company is engaged principally in automotive repair and maintenance and in the sale of automotive tires, parts and accessories through a chain of stores. As of January 30, 2010, the company operated stores in 35 states and Puerto Rico. Its primary operating unit is its Supercenter format, which serves both do-it-for-me, which includes service labor, installed merchandise and tires and do-it-yourself customers with service offerings and merchandise. The company operates approximately 11,686,000 of gross square feet of retail space, including service bays. The Supercenters average approximately 20,700 square feet, and Service & Tire Centers average 6,800 square feet.