AutoZone, Inc. (NYSE: AZO) is a leading retailer and distributor of automotive replacement parts and accessories in the United States. The company operates through various segments, including commercial, DIY (Do-It-Yourself), and international markets. AutoZone's competitors include companies like O'Reilly Automotive and Advance Auto Parts.
The company is set to release its quarterly earnings on December 9, 2025, with Wall Street estimating an earnings per share (EPS) of $32.35 and projected revenue of approximately $4.64 billion. AutoZone is strengthening its position as a robust compounder, with significant growth across its commercial, DIY, and international segments. The commercial segment, particularly the Do-It-For-Me (DIFM) market, is experiencing structural and sustainable growth. Despite short-term margin challenges related to LIFO accounting methods, these issues are expected to reverse, leading to substantial EPS power by fiscal year 2027. The DIY segment remains stable, and international expansion, especially in Mexico, adds diversified growth.
JP Morgan analyst Christopher Horvers maintains an Overweight rating on AutoZone, highlighting the company's resilient demand and potential for improved long-term earnings. Horvers increased his estimates and set a price target of $4,850, noting no structural slowdown in DIY demand despite early-quarter fluctuations. Favorable weather conditions and better weekend spending have helped regain momentum, with expectations for both DIY and DIFM comparable sales to accelerate.
AutoZone's financial metrics provide insight into its market valuation. The company has a price-to-earnings (P/E) ratio of approximately 25.60, indicating the market's valuation of its earnings. The price-to-sales ratio stands at about 3.39, reflecting the company's market value relative to its revenue. The enterprise value to sales ratio is around 4.02, showing the company's total valuation compared to its sales. The enterprise value to operating cash flow ratio is approximately 24.41, suggesting how the company's valuation compares to its cash flow from operations. AutoZone's earnings yield is about 3.91%, providing insight into the return on investment for shareholders. The company has a debt-to-equity ratio of approximately -3.57, indicating a higher level of debt compared to its equity. Lastly, the current ratio is around 0.88, suggesting the company's ability to cover its short-term liabilities with its short-term assets. The upcoming earnings report could significantly impact AutoZone's stock price, with potential upward movement if results exceed expectations.
