What Happened?
Shares of auto services provider Monro (NASDAQ: MNRO) fell 2.9% in the afternoon session after the company reported mixed third-quarter results, with a 4% drop in total sales that missed revenue expectations.
The decline in sales to $293.4 million was mainly caused by the closure of 145 underperforming stores. While this move hurt overall revenue, there were some positive signs. Sales at stores that remained open grew by 1.2%, and the company's gross margin improved. However, the earnings picture was complex. Reported profit per share rose to $0.35 from $0.15 in the previous year, but this was boosted by gains from selling property related to the closed stores. When excluding these one-time items, adjusted earnings per share actually fell to $0.16 from $0.19, giving a clearer view of the core business's performance.
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What Is The Market Telling Us
Monro’s shares are very volatile and have had 29 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 8 months ago when the stock gained 36.5% on the news that the company reported impressive first quarter 2025 (fiscal Q4) results: It was encouraging to see Monro beat analysts' revenue expectations. Additionally, the market liked two aspects of the print: comments that sales in the current quarter were up a healthy 7% thus far and initiatives to close 145 underperforming stores. Overall, this was a strong quarter.
Monro is down 2.3% since the beginning of the year, and at $19.25 per share, it is trading 10.2% below its 52-week high of $21.44 from December 2025. Investors who bought $1,000 worth of Monro’s shares 5 years ago would now be looking at an investment worth $329.26.
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