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AutoZone Is One Of The Steadiest Performers In Auto-Parts Retail Space

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AutoZone Is One Of The Steadiest Performers In Auto-Parts Retail Space

Oppenheimer hosted its 17th Annual Oppenheimer Consumer Conference in Boston this week and welcomed AutoZone, Inc. (NYSE: AZO)'s management team, including its executive vice president and chief financial officer, Bill Giles.

Following a chat with management, Oppenheimer's Brian Nagel maintains an Outperform rating on AutoZone's stock. The company's reputation as being one of the "steadiest performers" in the auto-parts retail space remains unchanged, the analyst noted in a brief research report.

In fact, AutoZone remains well positioned to take full advantage of the many favorable demand dynamics in the auto sector, most notably an aging vehicle fleet that is being driven more.

The company's management "made clear" its focus hasn't shifted from further parts proliferation in the space, especially through its hub and mega-hub buildout, the analyst continued. In addition, management also remains focused on expanding employee training, which results in better in-store services.

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Shares of AutoZone have come under pressure amid threats of online giants, namely Amazon.com, Inc. (NASDAQ: AMZN), looking to enter the space, but the analyst believes recent weakness can be attributed to "unfavorable weather" across key markets which was exacerbated by an "atypical cadence" of tax refunds.

Looking forward, the analyst is confident AutoZone sales trends will "rebound to more normal levels" and isn't concerned of any structural shift in the space.

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Image Credit: By Ildar Sagdejev (Specious) - Own work, GFDL, via Wikimedia Commons

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