Update shared on04 Oct 2025
Fair value Increased 3.07%AutoZone's analyst price target increased from approximately $4,420 to $4,556 per share, as analysts cite accelerating revenue growth and market share gains, despite recent margin pressures.
Analyst Commentary
Recent Street research reveals a spectrum of views on AutoZone, reflecting both confidence in long-term opportunities and ongoing caution regarding near-term headwinds. Analysts broadly recognize the company's ability to capture market share and execute on key initiatives, while noting valuation adjustments stemming from mixed quarterly results and ongoing margin pressures.
Bullish Takeaways- Bullish analysts highlight sustained market share gains, particularly in both the DIY and commercial segments. This has been driven by an accelerated store expansion strategy and new initiatives.
- Several research notes point to strong same-store sales momentum and positive pricing trends, with the company effectively passing through price increases with little impact on customer demand.
- There is confidence that margin pressures, such as those from LIFO charges and SG&A investments, are temporary. AutoZone is viewed as poised to return to robust double-digit EPS growth in the coming fiscal year.
- Valuation targets have generally trended higher. The risk/reward profile is still viewed as favorable by bullish analysts due to ongoing investment returns and compounding growth potential.
- Bearish analysts are cautious about near-term profitability, citing margin headwinds from non-cash LIFO charges and higher SG&A expenses linked to store expansion.
- Mixed quarterly results, with earnings misses despite in-line or better sales, have prompted some to lower price targets and reduce earnings estimates for the short term.
- There is ongoing concern that margin pressures could persist in the coming quarters, especially if SG&A leverage remains a challenge and buyback activity slows.
- Potential upside depends on foreign exchange trends and the pace of comparable sales growth. These factors bear watching amid a dynamic retail environment.
What's in the News
- AutoZone completed the repurchase of 117,000 shares between May 11, 2025 and August 31, 2025. This amounted to $446.2 million. (Key Developments)
- The company has now bought back a total of 44,806,031 shares for $31.6 billion under its buyback program, which began in December 2008. (Key Developments)
Valuation Changes
- Consensus Analyst Price Target has increased from $4,420 to $4,556 per share. This reflects growing optimism in valuation.
- Discount Rate has risen slightly from 8.58% to 8.64%, indicating a modestly higher expected return requirement from analysts.
- Revenue Growth expectations have increased from 6.22% to 7.57%. This shows greater anticipated top-line expansion.
- Net Profit Margin has declined slightly from 13.79% to 13.53%, suggesting some continued cost or margin pressures.
- Future P/E has fallen from 29.0x to 27.5x. This implies a modest decrease in expected valuation multiples.
Disclaimer
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