Analyst Simeon Gutman of Morgan Stanley maintained a Buy rating on AutoZone, boosting the price target to $4,700.00.
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Simeon Gutman has given his Buy rating due to a combination of factors that highlight AutoZone’s strong financial outlook and strategic positioning. The company is expected to achieve a compound annual growth rate of approximately 11% in earnings per share from fiscal year 2025 to 2029, demonstrating its capability as a reliable earnings generator. Despite facing near-term challenges from LIFO charges due to tariffs, AutoZone’s pricing strategy remains effective, with same-SKU price increases showing limited elasticity, indicating that the market can absorb these changes without significant demand reduction.
Additionally, AutoZone’s growth initiatives, such as enhancing customer service, expanding product availability, and improving delivery times, are contributing to its market share gains. The company’s domestic comparable sales are on an upward trajectory, with commercial sales growth accelerating and DIY sales remaining steady. These factors, combined with the expectation of continued topline momentum and strategic pricing, support the positive outlook for AutoZone, justifying the Buy rating and the increased price target of $4,700.
Gutman covers the Consumer Cyclical sector, focusing on stocks such as Advance Auto Parts, Topgolf Callaway Brands, and Ulta Beauty. According to TipRanks, Gutman has an average return of 3.8% and a 61.29% success rate on recommended stocks.
In another report released yesterday, Evercore ISI also reiterated a Buy rating on the stock with a $4,500.00 price target.