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AutoZone (AZO) Gains But Lags Market: What You Should Know

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In the latest trading session, AutoZone (AZO - Free Report) closed at $1,167.95, marking a +0.35% move from the previous day. This move lagged the S&P 500's daily gain of 0.75%. Elsewhere, the Dow gained 0.69%, while the tech-heavy Nasdaq added 1.32%.

Prior to today's trading, shares of the auto parts retailer had gained 3.57% over the past month. This has outpaced the Retail-Wholesale sector's gain of 0.59% and the S&P 500's gain of 3.42% in that time.

Wall Street will be looking for positivity from AZO as it approaches its next earnings report date. The company is expected to report EPS of $13.86, up 2.9% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $2.76 billion, up 4.62% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $65.25 per share and revenue of $12.15 billion, which would represent changes of +2.87% and +2.37%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for AZO. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

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. The Zacks Consensus EPS estimate has moved 0.22% lower within the past month. AZO currently has a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that AZO has a Forward P/E ratio of 17.82 right now. Its industry sports an average Forward P/E of 19.25, so we one might conclude that AZO is trading at a discount comparatively.

It is also worth noting that AZO currently has a PEG ratio of 1.46. 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. Automotive - Retail and Wholesale - Parts stocks are, on average, holding a PEG ratio of 1.6 based on yesterday's closing prices.

The Automotive - Retail and Wholesale - Parts industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 27, which puts it in the top 11% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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