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AutoZone's (AZO) Q1 Earnings Surpass, Sales Lag Estimates

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AutoZone, Inc. (AZO - Free Report) reported diluted earnings of $18.61 per share for the first quarter of fiscal 2021 (ended Nov 21, 2020), up from the prior-year figure of $14.3. The bottom line also surpassed the Zacks Consensus Estimate of $17.72. Higher-than-expected comparable sales growth led to this outperformance. Net income climbed 26.3% year over year to $442.4 million. Net sales also increased 12.9% year over year to $3,154.3 million. The top line, however, marginally missed the Zacks Consensus Estimate of $3,164 million.

For the reported quarter, domestic commercial sales totaled $695.3 million, up from the $621.5 million recorded in the year-ago quarter. The figure, however, lagged the consensus mark of $721 million. Nonetheless, domestic same-store sales (sales at stores open at least for a year) grew 12.3% year over year, outpacing the Zacks Consensus Estimate of 11.37%.

Gross profit increased to $1,675.6 million from the prior-year quarter’s $1,501.1 million. Operating profit also surged to $615.2 million from the $500 million registered in the year-ago period.

AutoZone, Inc. Price, Consensus and EPS Surprise

AutoZone, Inc. Price, Consensus and EPS Surprise

AutoZone, Inc. price-consensus-eps-surprise-chart | AutoZone, Inc. Quote

Store Opening & Inventory

During the fiscal first quarter, AutoZone opened 39 stores in the United States and two in Brazil. It exited the quarter with 5,924 stores in the United States, 621 in Mexico and 45 in Brazil. Total store count was 6,590 as of Nov 21, 2020.

AutoZone’s inventory improved 3.7% year over year in the reported quarter on store openings and increased product placement. At the end of the quarter, inventory per location was $702,000, up from the year-ago figure of $694,000.

Financials and Share Repurchases

AutoZone had cash and cash equivalents of $1,664 million as of Nov 21, 2020, up from $158.1 million as of Nov 23, 2019. Total debt amounted to $5,514.9 million as of Nov 21, 2020, marking an increase from the $5,287.3 million on Nov 23, 2019.

For the fiscal first quarter, AutoZone repurchased 584,379 shares for $678.3 million at an average price of $1,161 per share. The company has shares worth $117.6 million remaining in the current repurchase authorization.

AutoZone — peers of which include Advance Auto Parts (AAP - Free Report) , CarMax (KMX - Free Report) and O’Reilly Automotive Inc (ORLY - Free Report) — currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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