How much a stock's price changes over time is a significant driver for most investors. Not only can price performance impact your portfolio, but it can help you compare investment results across sectors and industries as well.
Another factor that can influence investors is FOMO, or the fear of missing out, especially with tech giants and popular consumer-facing stocks.
What if you'd invested in AutoZone (AZO) ten years ago? It may not have been easy to hold on to AZO for all that time, but if you did, how much would your investment be worth today?
AutoZone's Business In-Depth
With that in mind, let's take a look at AutoZone's main business drivers.
AutoZone, Inc. is one of the leading specialty retailers and distributors of automotive replacement parts and accessories in the United States. It operates in the Do-It-Yourself (DIY) retail, Do-It-for-Me (DIFM) auto parts and products markets. At the end of fiscal 2024, the company had 6,432 stores in the United States, 794 in Mexico and 127 in Brazil. The total store count was 7,353 as of Aug 31, 2024. Each store offers wide-ranging products for cars, sport utility vehicles, vans and light trucks, including new and remanufactured automotive hard parts, maintenance items, accessories and non-automotive products.
Apart from automotive products, it also has many commercial sales programs, which provide commercial credit and deliver parts and other products to local repair garages, dealers and service stations. AutoZone sells the ALLDATA brand’s automotive diagnostic and repair software through www.alldata.com and www.alldatadiy.com. This offers comprehensive factory-correct repair information to DIY customers, along with an ALLDATA repair subscription.
The company has an online presence to sell automotive hard parts, maintenance items, accessories and non-automotive products through its website, www.autozone.com. For commercial customers, it has www.autozonepro.com. AutoZone selects and purchases merchandise from store support centers situated in Memphis, TN, Monterrey, MX and Sao Paulo, BR. Also, it has an office in Shanghai, China, Haryana, India and Istanbul, Turkeyto support global sourcing efforts. This centralization improves the execution of merchandising and marketing strategies at the store level, as well as reduces expenses and cost of sales.
The company reported a 5.7% year-over-year increase in net revenues to $18.5 billion in fiscal 2024, with domestic same-store sales rising 0.4%. AutoZone generated net income of $2.67 billion, up 5.1% on a year-over-year basis.
AutoZone's competitors span a wide range including national, regional, and local auto parts chains, independent parts stores, online automotive parts stores, wholesale distributors, repair shops, car washes, and auto dealers. It also competes with discount and mass merchandise stores, hardware stores, supermarkets, drugstores, convenience stores, home stores, and other retailers selling aftermarket vehicle parts, supplies, chemicals, accessories, and tools.
Bottom Line
Anyone can invest, but building a successful investment portfolio requires research, patience, and a little bit of risk. So, if you had invested in AutoZone ten years ago, you're likely feeling pretty good about your investment today.
A $1000 investment made in May 2015 would be worth $5,558.24, or a 455.82% gain, as of May 27, 2025, according to our calculations. Investors should note that this return excludes dividends but includes price increases.
Compare this to the S&P 500's rally of 175.77% and gold's return of 171.97% over the same time frame.
Analysts are forecasting more upside for AZO too.
AutoZone anticipates sustained growth in both its DIY and commercial segments, underpinning its revenue expansion. The strategic development of mega hubs and omni-channel initiatives is poised to strengthen its long-term outlook. The company’s growth is supported by enhanced satellite store inventory, hub and mega-hub expansion, the Duralast brand’s success, faster delivery and improved customer service. Additionally, its disciplined capital allocation strategy of balancing reinvestment in the business with shareholder-friendly initiatives is commendable. However, substantial investments in technology to enhance the electronic catalog may constrain near-term cash flows. Moreover, a leveraged balance sheet and elevated interest expenses present significant risks. The stock warrants a cautious stance for the time being.
The stock has jumped 5.76% over the past four weeks. Additionally, no earnings estimate has gone lower in the past two months, compared to 2 higher, for fiscal 2025; the consensus estimate has moved up as well.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
AutoZone, Inc. (AZO): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
Zacks Investment Research
