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AutoZone (AZO) Stock Sinks As Market Gains: What You Should Know

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AutoZone (AZO - Free Report) closed the most recent trading day at $1,779.44, moving -0.3% from the previous trading session. This change lagged the S&P 500's 0.18% gain on the day.

Heading into today, shares of the auto parts retailer had gained 6.73% over the past month, outpacing the Retail-Wholesale sector's gain of 2.4% and the S&P 500's gain of 5.68% in that time.

Wall Street will be looking for positivity from AZO as it approaches its next earnings report date. On that day, AZO is projected to report earnings of $20.44 per share, which would represent year-over-year growth of 9.83%. Meanwhile, our latest consensus estimate is calling for revenue of $3.33 billion, up 5.59% from the prior-year quarter.

AZO's full-year Zacks Consensus Estimates are calling for earnings of $97.57 per share and revenue of $14.79 billion. These results would represent year-over-year changes of +2.5% and +1.11%, respectively.

Investors should also note any recent changes to analyst estimates for AZO. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 1.47% higher. AZO currently has a Zacks Rank of #2 (Buy).

Investors should also note AZO's current valuation metrics, including its Forward P/E ratio of 18.29. For comparison, its industry has an average Forward P/E of 19.19, which means AZO is trading at a discount to the group.

Investors should also note that AZO has a PEG ratio of 1.4 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Automotive - Retail and Wholesale - Parts was holding an average PEG ratio of 1.42 at yesterday's closing price.

The Automotive - Retail and Wholesale - Parts industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 18, putting it in the top 8% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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