UPDATE: Deutsche Bank Raises PT on AutoZone on Mixed Factors

In a report published Wednesday, Deutsche Bank analyst Greg Poole reiterated a Hold rating on AutoZone AZO, and raised the price target from $410.00 to $470.00. In the report, Deutsche Bank noted, “Internal initiatives, easier compares can help partially offset industry headwinds. The persistent decline in comp trends is a result of industry headwinds, primarily fewer cars in the 7-11 sweet spot in our view. But AZO is testing out a number of initiatives, including improving parts availability and distribution frequency to offset this dynamic. There seems to be some positive impact as AZO data points to better share performance this quarter. But it is coming at a cost on SGA and inventory, which both increased more than we estimated. AZO will continue these tests before making a decision if the sales benefit is worth the costs. AZO is also cycling negative comps, but the two year stacked may not accelerate. We maintain our Hold rating on valuation.” AutoZone closed on Tuesday at $471.86.