Shares of Pep Boys (NYSE:PBY) are trading near a 52-week high of $24 today, roughly four times as valuable as they were in April of last year. The reason is the red ink. There's less of it at the bottom line than many expected.

Fourth-quarter and full-year 2003 results show a retailer that appears to have turned things around. While competitor AutoZone (NYSE:AZO) has been weathering flat sales very well, it's been a longer road for Manny, Moe, and Jack. Last year saw significant financial wheel spinning due to restructuring and the retirement of underperforming CEO Mitchell Leibovitz.

But the recent numbers suggest the boys have rediscovered their pep. Fourth-quarter revenues were up 13.6%, with comparable sales of merchandise up nearly 16% compared to last year. That's a decent tally given competition from the likes of Wal-Mart (NYSE:WMT) and Target (NYSE:TGT), which operate big-box discounters in the same strip mall as my neighborhood Pep Boys shop.

Earnings -- well, losses, actually -- were $0.07 per share, more than double the Q4 loss last year. But that doesn't quite tell the whole story. The quarter saw special reorganization charges of over $10 million, so modifying the numbers for these, adjusted income from continuing operations would have been $0.12 per share, versus $0.03 for the same period last year.

The year's results culminate in a $0.22 loss per share on sales that were up an itty-bitty 1.7%. Even engaging in a little mathematical hocus-pocus as above -- to strain out the year's heavy restructuring charges -- yields a drop in 2004's adjusted operating earnings per share as compared to 2003.

But stocks trade on future expectations, so investors need to look ahead and make some guesses as to whether Pep Boys is really on the road to riches. I'd argue that the jury is still out. Last year, gross margins fell and SG&A expenses rose. Accounts receivable nearly doubled, and inventory's increase outpaced the rise in sales. That's the opposite of what should happen to a firm in turnaround mode.

M, M, & J deserve points for increasing cash and reducing debt, but they need to roll up their sleeves, get under the hood, and finish the job.

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Fool contributor Seth Jayson thinks that the world would be a better place if all car owners changed their own oil. He has no stake in any company mentioned above.