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AutoZone (AZO) Q1 Earnings Beat on Better-Than-Expected Comps

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AutoZone, Inc. (AZO - Free Report) reported earnings of $25.69 per share for first-quarter fiscal 2022 (ended Nov 20, 2021), surging from the prior-year figure of $18.61. The bottom line also surpassed the Zacks Consensus Estimate of $20.83. Robust comparable sales growth led to this outperformance.

Net income increased 25.5% year over year to $555.2 million. Net sales also grew 16.3% year over year to $3,668.9 million. The top line, moreover, topped the Zacks Consensus Estimate of $3,358 million.

For the reported quarter, domestic commercial sales totaled $899.9 million, up from $695.3 million recorded in the year-ago period. In addition, domestic same-store sales (sales at stores open at least for a year) rose 13.6%, handily beating the Zacks Consensus Estimate of 3.9%.

Gross profit increased to $1,925.1 million from the prior-year quarter’s $1,675.6 million. Operating profit moved up to $754.5 million from $615.2 million registered in the year-earlier 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 15 stores in the United States, two in Mexico and one in Brazil. It exited the quarter with 6,066 stores in the United States, 666 in Mexico and 53 in Brazil. The total store count was 6,785 as of Nov 20, 2021.

AutoZone’s inventory improved 3% year over year for the reported quarter on store openings. At quarter-end, inventory per location was $703,000, up from the year-ago figure of $702,000.

Financials and Share Repurchases

AutoZone had cash and cash equivalents of $961.1 million as of Nov 20, 2021, down from $1,664 million on Nov 21, 2020. Total debt amounted to $5,271.3 million as of Nov 20, 2021, marking a decrease from $5,514.8 million on Nov 21, 2020.

In the fiscal first quarter, it repurchased 515,000 shares for $900 million at an average price of $1,749 per share. The company has shares worth around $1 billion remaining in the current repurchase authorization.

AutoZone — whose peers include Advance Auto Parts (AAP - Free Report) and O’Reilly Automotive Inc. (ORLY - Free Report) — currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Peers’ Quarterly Highlights

Advance Auto reported third-quarter 2021 results on Nov 15. Adjusted earnings of $3.21 per share increased 21.6% from the prior-year figure and beat the Zacks Consensus Estimate of $2.78 on higher-than-expected comps growth. For the third quarter, comparable store sales witnessed 3.1% growth. Advance Auto generated net revenues of $2,621.2 million, topping the Zacks Consensus Estimate of $2,564 million and rising 3.1% from the year-ago reported figure.

Advance Auto had cash and cash equivalents of $604.6 million as of Oct 9, 2021 compared with $834.9 million on Jan 2, 2021. Total long-term debt was $1,034 million as of Oct 9, 2021, slightly up from $1,033 million on Jan 2, 2021. AAP currently carries a Zacks Rank #3 (Hold).

O’Reilly reported third-quarter 2021 results on Oct 27. Adjusted earnings per share of $8.07 grew 14% year over year and surpassed the Zacks Consensus Estimate of $6.99 on the back of comparable store sales growth. Comps grew 6.7% year over year for the quarter versus the Zacks Consensus Estimate of a decline of 15.02%. Revenues of $3,479.6 million topped the consensus mark of $3,217 million and increased from the prior-year level of $3,207.6 million. 

O’Reilly had cash and cash equivalents of $449.3 million as of Sep 30, 2021. Its long-term debt stands at $3,826.1 million, lower than the year-ago level of $4,122.4 million. ORLY currently carries a Zacks Rank #3.


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