AutoZone (AZO) AI Stock Analysis

• Market Cap: $71.06B
• Dividend Yield: N/A
• Average Volume (3M): 126.39K
• Price to Earnings (P/E): 29.4
• Beta (1Y): 0.35
• Revenue Growth: 2.43%
• EPS Growth: -3.34%
• Country: US
• Employees: 75,600
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Specialty Retail
• EPS (TTM): 48.71
• Shares Outstanding: 16,728,714
• 10 Day Avg. Volume: 153,351
• 30 Day Avg. Volume: 126,385
• PEG Ratio: 1.64
• Price to Book (P/B): -11.59
• Price to Sales (P/S): 2.98
• P/FCF Ratio: 28.51
• Enterprise Value/Market Cap: 1.18
• Enterprise Value/Revenue: 4.43
• Enterprise Value/Gross Profit: 8.37
• Enterprise Value/Ebitda: 19.42
• 1Y Price Target: $4,645.53
• Price Target Upside: 10.21% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 20

• Rating: 68 Neutral
• Price Target: $4,491.00 ▲(6.55% Upside)

AutoZone's overall stock score reflects strong financial performance and sales growth, tempered by high leverage, declining free cash flow, and valuation concerns. The technical indicators suggest mixed momentum, while the earnings call highlights both growth opportunities and financial challenges. The absence of a dividend yield further limits attractiveness for some investors.

Positive Factors

Strong Revenue Growth

Consistent revenue growth indicates strong market demand and effective business strategies, supporting long-term financial stability and expansion.

Record Store Openings

Expanding store count enhances market presence and accessibility, driving future revenue growth and strengthening competitive positioning.

Market Share Gains

Increasing market share reflects competitive advantages and customer loyalty, which are crucial for sustaining long-term growth and profitability.

Negative Factors

High Leverage

High leverage can limit financial flexibility and increase risk, potentially impacting the company's ability to invest in growth opportunities.

Declining Free Cash Flow

Reduced free cash flow may constrain the company's ability to fund operations and investments, affecting long-term growth prospects and resilience.

SG&A Expense Growth

Rising SG&A expenses can pressure margins and profitability, necessitating better cost management to sustain financial health over time.

AutoZone Business Overview & Revenue Model

Company Description

AutoZone, Inc. retails and distributes automotive replacement parts and accessories. The company offers various products for cars, sport utility vehicles, vans, and light trucks, including new and remanufactured automotive hard parts, maintenance items, accessories, and non-automotive products. Its products include A/C compressors, batteries and accessories, bearings, belts and hoses, calipers, chassis, clutches, CV axles, engines, fuel pumps, fuses, ignition and lighting products, mufflers, radiators, starters and alternators, thermostats, and water pumps, as well as tire repairs. In addition, the company offers maintenance products, such as antifreeze and windshield washer fluids; brake drums, rotors, shoes, and pads; brake and power steering fluids, and oil and fuel additives; oil and transmission fluids; oil, cabin, air, fuel, and transmission filters; oxygen sensors; paints and accessories; refrigerants and accessories; shock absorbers and struts; spark plugs and wires; and windshield wipers. Further, it provides air fresheners, cell phone accessories, drinks and snacks, floor mats and seat covers, interior and exterior accessories, mirrors, performance products, protectants and cleaners, sealants and adhesives, steering wheel covers, stereos and radios, tools, and wash and wax products, as well as towing services. Additionally, the company provides a sales program that offers commercial credit and delivery of parts and other products; sells automotive diagnostic and repair software under the ALLDATA brand through alldata.com and alldatadiy.com; and automotive hard parts, maintenance items, accessories, and non-automotive products through autozone.com. As of November 20, 2021, it operated 6,066 stores in the United States; 666 stores in Mexico; and 53 stores in Brazil. The company was founded in 1979 and is based in Memphis, Tennessee.

How the Company Makes Money

AutoZone generates revenue primarily through the sale of automotive parts and accessories. The company has two main revenue streams: retail and commercial. The retail segment caters to DIY customers, where sales are driven by a wide selection of parts and accessories, coupled with customer service experiences like in-store diagnostics and advice. The commercial segment, on the other hand, focuses on professional mechanics and businesses, providing bulk sales, delivery services, and specialized accounts. AutoZone also benefits from its proprietary private-label products, which typically yield higher margins. Additionally, the company has established strategic partnerships with various suppliers and manufacturers, enhancing its supply chain and product offerings. Seasonal promotions, loyalty programs, and an expanding online presence further contribute to its earnings through increased customer engagement and sales.

AutoZone Financial Statement Overview

Summary

AutoZone exhibits strong revenue growth and profitability, supported by effective cost management. However, the high leverage and declining free cash flow present potential risks. The company should focus on improving liquidity and managing debt levels to ensure sustainable growth.

Income Statement

AutoZone shows robust revenue growth with a TTM increase in revenue of 2.22% compared to the previous year. The gross profit margin is strong at 52.94%, and the net profit margin is healthy at 13.56%. However, a slight decrease in EBIT margin from 20.49% to 19.63% indicates a need to control operational costs better. Overall, the company demonstrates consistent profitability and revenue growth.

Balance Sheet

The balance sheet reveals a high debt-to-equity ratio due to negative stockholders' equity, which poses a financial risk. However, the equity ratio is negative, reflecting high leverage. Despite these concerns, the company has been able to maintain profitability, suggesting effective use of leverage to generate returns.

Cash Flow

The cash flow statement indicates a decline in free cash flow by about 62.53% in the TTM, impacting liquidity. However, the operating cash flow to net income ratio of 0.42 reflects adequate cash generation relative to profits. The free cash flow to net income ratio is 0.28, which is below optimal levels, suggesting room for improvement in cash management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	18.90B	18.49B	17.46B	16.25B	14.63B	12.63B
Gross Profit	10.01B	9.82B	9.07B	8.47B	7.72B	6.77B
EBITDA	4.31B	4.35B	3.98B	3.72B	3.36B	2.82B
Net Income	2.56B	2.66B	2.53B	2.43B	2.17B	1.73B
Balance Sheet
Total Assets	18.62B	17.18B	15.99B	15.28B	14.52B	14.42B
Cash, Cash Equivalents and Short-Term Investments	268.63M	298.17M	277.05M	264.38M	1.17B	1.75B
Total Debt	12.19B	12.37B	10.93B	9.30B	8.23B	8.31B
Total Liabilities	22.60B	21.93B	20.34B	18.81B	16.31B	15.30B
Stockholders Equity	-3.97B	-4.75B	-4.35B	-3.54B	-1.80B	-877.98M
Cash Flow
Free Cash Flow	2.00B	1.93B	2.14B	2.54B	2.90B	2.26B
Operating Cash Flow	3.23B	3.00B	2.94B	3.21B	3.52B	2.72B
Investing Cash Flow	-1.29B	-1.29B	-876.18M	-648.10M	-601.78M	-497.88M
Financing Cash Flow	-1.94B	-1.68B	-2.06B	-3.47B	-3.50B	-643.64M

AutoZone Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 4215.08
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AZO, the sentiment is Positive. The current price of 4215.08 is below the 20-day moving average (MA) of 4222.97, above the 50-day MA of 4118.99, and above the 200-day MA of 3703.99, indicating a neutral trend. The MACD of 30.02 indicates Positive momentum. The RSI at 52.95 is Neutral, neither overbought nor oversold. The STOCH value of 74.18 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AZO.

AutoZone Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DORM	76 Outperform	$4.76B	21.38	17.38%	―	6.76%	34.97%
LKQ	71 Outperform	$8.06B	11.44	11.20%	3.83%	-3.02%	-1.02%
ORLY	70 Neutral	$89.67B	37.54	-174.09%	―	5.15%	5.33%
AZO	68 Neutral	$71.06B	29.36	-14.95%	―	2.43%	-3.34%
GPC	67 Neutral	$19.22B	23.80	17.50%	2.93%	2.65%	-32.91%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
AAP	54 Neutral	$3.71B	59.62	-24.78%	1.63%	-22.50%	-35219.23%

AutoZone Corporate Events

AutoZone Appoints Constantino Spas Montesinos to Board

On May 28, 2025, AutoZone announced the appointment of Constantino Spas Montesinos to its Board of Directors. Mr. Spas, who is the CEO of Proximity Americas and Mobility Division at FEMSA, brings extensive international and industry experience to AutoZone. His appointment is expected to enhance board discussions and drive exceptional performance for the company, which now has 11 board members.