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Will AutoZone’s 1Q17 Earnings Impress Investors?

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AutoZone’s 1Q17 earnings

Previously, we looked at how America’s two major auto part retailers, AutoZone (AZO) and Advanced Auto Parts (AAP), have outperformed the broader market in the last three months. AutoZone’s impressive track record of positive growth could be one of the primary reasons for this optimism on Wall Street. Let’s take a quick look at AZO’s recent quarterly earnings performance.

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4Q16 recap

In 4Q16, which ended on August 27, AutoZone reported EPS (earnings per share) of $14.30. This was about 12% higher than the company’s EPS of $12.75 in the corresponding quarter of the previous year. Higher total sales and improved domestic same-store sales were some key drivers behind this growth.

1Q17 EPS estimates

Analysts are expecting the existing positive trend in the company’s earnings to continue in 1Q17. According to the estimate, AutoZone’s EPS could be $9.31, about 12.3% higher than the corresponding quarter of 2015.

Advance Auto Parts released its most recent quarterly earnings on November 14, 2016. Despite a YoY (year-over-year) decline in its key financial metrics, the company managed to beat analysts’ estimates, a primary reason why AAP has risen about 21.9% in November so far. Therefore, it will be interesting to see if investors react in a similar fashion if AutoZone delivers solid earnings growth in line with analysts’ estimates.

Note that in the most recent reported quarter, earnings of mainstream automakers (XLY) such as General Motors (GM) and Fiat Chrysler (FCAU) have also gone up.

Continue to the next part to learn what analysts are estimating for AutoZone’s 1Q17 revenues.

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