JPMorgan Trims AutoZone (AZO) PT to $4,200 Despite Domestic Sales Beat, Cites Margin Pressures

On Wednesday, JPMorgan lowered its price target for AutoZone Inc. (NYSE:AZO) to $4,200 from $4,350, while maintaining an Overweight rating on the shares.

This revision follows the company's FQ3 2025 report, which saw AutoZone deliver a domestic comparable sales beat but experience worse-than-expected margin pressures. The reported earnings essentially aligned with JPMorgan's forecast, which was already below broader Street expectations.

In FQ3, AutoZone reported total sales of $4.5 billion, which was a 5.4% increase year-over-year. Domestic comparable sales were up 5%, while international comparable sales were up 8.1% on a constant currency basis. Domestic commercial sales demonstrated strong growth of 10.7% year-over-year, marking the first double-digit growth since FY2023, and the commercial segment surpassed $5 billion in sales on a rolling 4-quarter basis for the first time.

The company also opened 54 net new domestic stores and 30 new international stores and brought the total international store count to 979. JPMorgan noted that the domestic business is stabilizing at a 4% comparable sales rate due to AutoZone's efforts to accelerate market share gains and potential for further pricing. The firm anticipates that AutoZone will continue to invest to gain market share and widen its moat against competitors.

AutoZone Inc. (NYSE:AZO) retails and distributes automotive replacement parts and accessories in the US, Mexico, and Brazil.

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Disclosure: None. This article is originally published at Insider Monkey.