Accordingly, I would expect Pep Boys to post sales results that beat Street estimates by at least 1.5% ($540.8 million). On the bottom line, however, the Street is looking for 9 cents per share in earnings, or year-over-year growth of 125%. That number seems aggressive, especially since Pep Boys missed EPS estimates last year by 6 cents.
With that said, it wouldn't surprise me to see the stock sell-off even after a better-than-expected earnings performance. Even when looking at Pep Boys' fiscal 2014 EPS estimates, which cuts the P/E by one-third to 17, the stock is still trading 3 points higher than both Auto Zone and Advance Auto Parts, which trades at fiscal 2014 EPS estimates of 13.
Bottom LinePep Boys today is far different than where the company was a year ago. After so many long battles with failed improvement attempts, Pep Boys no longer has to answer the question regarding its business model and whether it can still work. The recent performance and clear fundamental shift to service-oriented business suggests that the model is progressing well.
Clearly, I like Pep Boys today more than I did in April. But there are still better investment opportunities out there. At the time of publication, the author held no position in any of the stocks mentioned. Follow @saintssense This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.