UBS analyst Michael Lasser maintained a Buy rating on AutoZone today and set a price target of $4,800.00.
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Michael Lasser has given his Buy rating due to a combination of factors that highlight AutoZone’s potential for growth and profitability. The company has shown strong comparable sales growth, indicating successful investments that are expected to continue driving market share gains in the coming years. Although there are short-term pressures on profitability due to non-cash LIFO charges, these are linked to inflationary trends that could eventually reverse and lead to significant earnings growth.
Furthermore, AutoZone is strategically expanding its store network and infrastructure, which, while initially increasing SG&A costs, is viewed as a beneficial long-term investment. The temporary margin pressures are expected to stabilize, allowing the company to maintain its double-digit EPS growth. Additionally, the anticipated normalization of inflation rates should help recover gross margins, reinforcing the company’s financial position moving forward.
According to TipRanks, Lasser is a 5-star analyst with an average return of 13.9% and a 67.07% success rate. Lasser covers the Consumer Cyclical sector, focusing on stocks such as Dick’s Sporting Goods, Floor & Decor Holdings, and Five Below.
In another report released today, Morgan Stanley also maintained a Buy rating on the stock with a $4,700.00 price target.