After Wells Fargo and Argus Research gave AutoZone (NYSE: AZO) a Buy rating last month, the company received another Buy, this time from Oppenheimer. Analyst Brian Nagel assigned a Buy rating to AutoZone today and set a price target of $860. The company’s shares opened today at $700.
Nagel wrote:
“Earlier today, Outperform-rated AutoZone (AZO) reported results for fiscal Q3 (period ending May 5th). In the quarter, comp sales of +0.6% tracked below consensus forecasts for +2-3%, impacted by cold/wet conditions into early April. AZO management made clear that as weather normalized in recent weeks, comp trends subsequently picked up at an accelerated pace. Shares have reversed this morning’s gains and are now trading down (7%). In our view, commentary around wage pressures and a notch higher in expense growth in FY19 (Aug.) have caused the market to look beyond indications of improving top-line results. We remind investors AZO manages store-level labor well and indicates an ability to pass along inflationary costs to consumers, over time. We stick with our Outperform rating.”
According to TipRanks.com, Nagel is a 4-star analyst with an average return of 4.1% and a 59.9% success rate. Nagel covers the Services sector, focusing on stocks such as Restoration Hardware Holdings Inc, Dick’s Sporting Goods, and Lumber Liquidators.
Currently, the analyst consensus on AutoZone is Moderate Buy and the average price target is $806.77, representing a 15.3% upside.
In a report issued on May 7, Goldman Sachs also maintained a Buy rating on the stock with a $780 price target.
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Based on AutoZone’s latest earnings release for the quarter ending February 28, the company reported a quarterly net profit of $290 million. In comparison, last year the company had a net profit of $332 million.
Based on the recent corporate insider activity of 56 insiders, corporate insider sentiment is positive on the stock. This means that over the past quarter there has been an increase of insiders buying their shares of AZO in relation to earlier this year.
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AutoZone, Inc. engages in the provision of retail and a distribution of automotive replacement parts and accessories. It operates through Auto Parts Locations, and Other segments. The Auto Parts Locations segment is provides automotive parts and accessories through the company’s stores in the United States, Puerto Rico, Mexico, and Brazil.
