Toronto, Ontario -- Companies in the broader automotive aftermarket sector posted mixed results this week as investors weighed recently released earnings reports and strategic moves.
This week, Collision Repair takes a closer look at the week's most significant corporate announcements from the past few days and the impact these have had on stock prices.
Advance Auto Parts beats estimates, guides higher
Advance Auto Parts reported fourth-quarter earnings February 13 that more than doubled Wall Street expectations.
The company posted adjusted earnings of US$0.86 per share on revenue of US$1.97 billion, well above analyst forecasts of US$0.43 per share.
Fourth-quarter comparable sales rose 1.1%, marking the first positive full-year comp growth in three years. Adjusted operating income margin expanded to 3.7% in the quarter, up 870 basis points year-over-year.
For the full year, Advance reported adjusted operating margin of 2.5%, up more than 200 basis points from near-breakeven levels in 2024. The company closed more than 500 corporate stores and 200 independent locations during the year, saving approximately US$70 million in operating costs.
"In 2025, we laid the foundation to build a better future for the Company," CEO Shane O'Kelly said in the earnings release. "We returned to full year positive comparable sales growth following three years of negative results and expanded adjusted operating income margin by over 200 basis points."
For 2026, Advance expects adjusted earnings between US$2.40 and US$3.10 per share with comparable sales up 1% to 2%. The company targets adjusted operating margin of 3.8% to 4.5% and plans to open 40 to 45 stores while adding 10 to 15 market hubs.
CFO Ryan Grimsland said the company expects to generate approximately US$100 million in free cash flow in 2026.
Shares surged over 10% in premarket trading before settling at US$59.93 by close, up 2.9% from US$58.22. The stock rally reflected investor confidence in the company's operational improvements despite ongoing challenges in consumer spending.
Sherwin-Williams posts record sales despite 'softer for longer' demand
Sherwin-Williams reported January 29 it delivered record full-year consolidated sales and adjusted earnings per share in 2025 despite persistent weakness across most end markets.
The Cleveland-based coatings manufacturer posted fourth-quarter adjusted earnings of US$2.23 per share, beating analyst estimates of US$2.16. Revenue reached US$5.6 billion in the quarter, up 5.6% year-over-year. For the full year, consolidated sales grew 2.1% to US$23.57 billion, with adjusted earnings per share of US$11.43.
Fourth-quarter adjusted EBITDA grew 13.4%, expanding margin by 100 basis points to 17.7% of sales. Free cash flow conversion in the quarter hit 90.1%. The company generated US$3.45 billion in net operating cash for the full year, or 14.6% of sales.
"Our team refused to wait for the market and instead focused on creating opportunities and controlling what we could control," CEO Heidi Petz said on the earnings call. She described the demand environment as "softer for longer" and said conditions are expected to persist into the second half of 2026.
For 2026, Sherwin-Williams projected consolidated sales to grow by low to mid-single digits. The company guided adjusted earnings between US$11.50 and US$11.90 per share, representing approximately 2.4% growth at the midpoint. Management plans to open 80 to 100 net new stores.
Petz announced the company will reinstate its 401(k) matching program for eligible U.S. employees effective February 1, restoring contributions paused in October. She said the decision was enabled by elevated performance and accelerated cost reductions, which generated approximately US$40 million in savings in 2025 and are expected to deliver US$46 million in 2026.
Shares rose 1.5% to US$372.60 on February 12, suggesting investors had already priced in the cautious outlook.
Axalta delivers record earnings, touts AkzoNobel merger
Axalta Coating Systems reported February 10 it delivered record full-year 2025 earnings despite a 3% sales decline, highlighting the company's margin discipline ahead of its planned merger with AkzoNobel.
The Philadelphia-area coatings supplier posted full-year adjusted EBITDA of US$1.13 billion with a 22% margin, one of the highest in company history and 100 basis points above its strategic plan target. Adjusted earnings per share reached US$2.49, up 6% from 2024. Net sales totaled US$5.12 billion.
In the fourth quarter, Axalta generated net sales of US$1.26 billion, down 4% year-over-year, with adjusted EBITDA of US$272 million and a 21.5% margin. The company posted record quarterly free cash flow of US$290 million, supported by strong working capital management and lower interest and tax payments.
"We delivered record earnings in 2025, demonstrating the resilience of our business and the successful execution of our 2026 A Plan in the midst of a challenging macro environment," CEO Chris Villavarayan said in the earnings release. "We are building top line momentum, and our 2025 Adjusted EBITDA margin was 22%—one of the highest in the company's history."
Axalta's Refinish segment, which serves collision repair, saw fourth-quarter sales decline 6% to US$791 million as distributor consolidation and claims pressure weighed on volumes. The company added more than 2,800 net new body shops during the year and achieved 2% pricing.
For 2026, Axalta expects low single-digit revenue growth, adjusted EBITDA of US$1.14 billion to US$1.17 billion, and adjusted earnings of US$2.55 to US$2.70 per share. The company projects free cash flow above US$500 million and net leverage below 2x by year-end.
Villavarayan reaffirmed the company's planned all-stock merger of equals with AkzoNobel, announced in November 2025. The transaction is expected to close in late 2026 or early 2027, subject to shareholder and regulatory approvals. Management projects approximately US$600 million in cost synergies and 100 to 200 basis points of revenue synergies.
Shares climbed 3% to US$34.59 on February 12 as investors assessed the margin performance and merger timeline.
