In a report published Tuesday, Goldman Sachs analyst Matthew J. Fassler downgraded the rating on AutoZone AZO from Buy to Neutral, but raised the price target from $470.00 to $500.00.
In the report, Goldman Sachs noted, “We remove AZO from the Buy List, and rate the shares Neutral. The stock has approached our prior 12-month $470 target, rising with a strong market despite sluggish recent fundamentals. We are guarded on the aftermarket sector given fading demand drivers, namely in the DIY sub-segment, where AZO sharply over-indexes vs. peers. In our view, the company continues to execute well, but lofty returns appear to serve as impediment to a full-on commitment to growing commercial. Also, ROC looks poised to fall from powerful peak levels. Since added to the Buy list on 4/3/2012, AZO is +22%, vs. +28% for the S&P 500. Over the last 12 months, AZO is +22%, vs. SPX +28%.”
AutoZone closed on Monday at $465.70.
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