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Wall Street Ratings for AutoZone before Fiscal 2Q18 Earnings

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Ratings on AutoZone stock

According to analysts’ latest consensus data from Reuters, 42% of analysts covering AutoZone (AZO) gave the stock a “buy” recommendation. Another 54% have recommended a “hold,” while only one of 26 analysts, about 4%, gave a “sell” recommendation.

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Upside potential

As of February 20, analysts’ consensus target price for AutoZone stock was $809.90 in the next 12 months, which reflected an upside potential of about 13.6% from the market price of $713.23. About three months ago, analysts’ consensus target for AutoZone stock was much lower, at $648.82.

Analysts expectations of Autozone’s continued revenues and DIY (do-it-yourself) segment growth could be the primary reasons why many analysts maintain a positive view. It’s important to note that AZO’s business model doesn’t require huge investments to drive growth—unlike case auto manufacturers.

Ratings for peers

Analysts’ consensus “buy” recommendations for other auto companies and auto parts sellers (XLY), with their expected 12-month upside potential, were as follows:

  • About 46% of a total 26 analysts recommended a “buy” for Advance Auto Parts (AAP) with an upside potential of ~9.8%.
  • A majority 68% of analysts gave O’Reilly Automotive (ORLY) a “buy” with about 15.5% upside potential.
  • For Ford (F), only 13% of analysts gave its stock a “buy,” with about 14.8% upside potential.
  • For Fiat Chrysler (FCAU), 46% of analysts gave a “buy” recommendation, with an impressive 56.3% upside potential.

Read on to the next part of this series, where we’ll take a look at AutoZone’s valuation multiples ahead of its upcoming quarterly earnings.

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