A month has passed by for the reason that final earnings report for AutoZone (AZO). Shares have misplaced about 1.2% in that time-frame, outperforming the S&P 500.
Will the latest unfavourable development proceed main as much as its subsequent earnings launch, or is AutoZone due for a breakout? Earlier than we dive into how buyers and analysts have reacted as of late, let’s take a fast have a look at its most up-to-date earnings report in an effort to get a greater deal with on the necessary drivers.
AutoZone Q1 Earnings Miss Expectations, Revenues Rise Y/Y
AutoZone reported earnings of $32.52 per share for the primary quarter of fiscal 2025 (ended Nov. 23, 2024), which missed the Zacks Consensus Estimate of $33.54. The corporate reported earnings of $32.55 per share within the corresponding quarter of fiscal 2024. Web gross sales grew 2.1% yr over yr to $4.28 billion. The highest line, nevertheless, missed the Zacks Consensus Estimate of $4.29 billion.
Within the reported quarter, home business gross sales totaled $1.13 billion, up from $1.09 billion recorded within the year-ago interval. Home same-store gross sales (gross sales at shops open no less than for a yr) had been up 0.3%.
Gross revenue elevated to $2.27 billion from the prior-year quarter’s $2.21 billion. Working revenue decreased 0.8% yr over yr to $841 million.
Retailer Opening & Stock
Through the quarter, AutoZone opened 23 new shops in the USA. It opened six new shops in Mexico and 5 in Brazil. It exited the quarter with 6,455 shops in the USA, 800 in Mexico and 132 in Brazil. The full retailer depend was 7,387 as of Nov. 23, 2024.
Its stock elevated 8.7% yr over yr within the reported quarter. At quarter-end, the stock per retailer was $849,000 in contrast with $806,000 a yr in the past.
Financials and Share Repurchases
As of Nov. 23, 2024, AutoZone had money and money equivalents of $304 million, up from $298.2 million as of Aug. 31, 2024. Its whole debt amounted to $9.01 billion as of Nov. 23, 2024, in contrast with $9.02 billion as of Aug. 31, 2024.
The corporate repurchased 160,000 shares of its frequent inventory for $505.2 million through the fiscal first quarter at a mean value of $3,156 per share. At quarter-end, it had $1.7 billion remaining below its present share repurchase authorization.
How Have Estimates Been Shifting Since Then?
Up to now month, buyers have witnessed a downward development in contemporary estimates.
VGM Scores
Presently, AutoZone has a powerful Progress Rating of A, although it’s lagging loads on the Momentum Rating entrance with an F. Nevertheless, the inventory was allotted a grade of C on the worth facet, placing it within the center 20% for this funding technique.
Total, the inventory has an combination VGM Rating of C. When you aren’t targeted on one technique, this rating is the one you need to be desirous about.
Outlook
Estimates have been broadly trending downward for the inventory, and the magnitude of those revisions signifies a downward shift. Notably, AutoZone has a Zacks Rank #3 (Maintain). We count on an in-line return from the inventory within the subsequent few months.
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