Skip to main content

Market Overview

AutoZone Is A DIY Winner, Jefferies Says In Upgrade

AutoZone Is A DIY Winner, Jefferies Says In Upgrade

Auto parts and accessories retailer AutoZone, Inc. (NYSE: AZO) can count on significant do-it-yourself sales while working on growing long-term sales in the do-it-for-me category, according to Jefferies.

The AutoZone Analyst: Bret Jordan upgraded AutoZone from Hold to Buy with a price target lifted from $1,230 to $1,325.

The AutoZone Thesis: Autozone's "outsized" DIY exposure, at around 78% of total sales, represents a favorable tailwind as economic hardships force more people to maintain their older vehicles, Jordan said in a Friday upgrade note.

The company historically sees record sales growth in the months and years exiting a recession, the analyst said. If history is any indication, the company could see strong growth in the near-term given high levels of unemployment and COVID-19 related economic hardships, he said. 

Over the long-term, Autozone needs to grow share in the DIFM market, and there is reason to believe management is heading in the right direction, Jordan said.

DIFM-related sales have risen at a 12% compounded annual growth rate since fiscal 2010, the analyst said. 

AutoZone has further room to grow, as just 15% of all stores lack a commercial program that would help generate new sales in the DIFM category, he said. 

Related Link: Jason Snipe Gives His Bullish Thoughts On Wayfair, AutoZone

"Longer term, we expect AZO's DIFM segment will continue to outpace overall industry sales growth as the company expands commercial operations and gains share, which should
translate into meaningful EPS growth."  

Autozone offers investors an impressive track record of an "aggressive" share buyback program, and has repurchased 85% of all outstanding shares since 1998, Jordan said.

The company should be able to repurchase around 1.5 million shares a year, and this will translate to an extra $8.90 in EPS in fiscal 2022, the analyst said. 

AZN Price Action: Shares of AutoZone were trading higher by 1.64% Friday to $1,159.69.

Photo by Steve Morgan via Wikimedia

Latest Ratings for AZO

Apr 2021JP MorganMaintainsOverweight
Mar 2021Morgan StanleyMaintainsOverweight
Mar 2021Wells FargoMaintainsOverweight

View More Analyst Ratings for AZO
View the Latest Analyst Ratings


Related Articles (AZO)

View Comments and Join the Discussion!

Posted-In: auto automotive Bret Jordan JefferiesAnalyst Color Upgrades Price Target Analyst Ratings Best of Benzinga

Latest Ratings

SAMEvercore ISI GroupMaintains1,500.0
SEAutonomous ResearchInitiates Coverage On378.0
ALHCMorgan StanleyInitiates Coverage On36.0
ALHCRaymond JamesInitiates Coverage On30.0
HAEMorgan StanleyDowngrades83.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Everything you need to know about the latest SPAC news.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at