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AutoZone, Inc.

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In the first quarter of fiscal 2019, AutoZone’s adjusted earnings and revenues surpassed the respective Zacks Consensus Estimate. Further, the figures witnessed year-over-year rise, driven by both Do-It-Yourself (DIY) retail and commercial (DIFM) businesses. For fiscal 2019, AutoZone is expected to witness year-over-year growth on the back of new programs in commercial business, store openings and improving online presence. Moreover, it frequently opens new stores and distribution centers to improve market coverage. However, continuous rise in capital and operating expenses due to frequent opening of distribution centers and wage expenses are concerns for AutoZone. Also, too much dependence on seasonality and weather conditions makes the company’s business vulnerable to irregular weather conditions. Year to date, shares of AutoZone have underperformed the industry it belongs to.

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