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Will AutoZone (AZO) Sustain Its Beat Streak in Q4 Earnings?
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AutoZone (AZO - Free Report) is slated to release fourth-quarter fiscal 2023 results on Sep 19, before the opening bell. The Zacks Consensus Estimate for the quarter’s earnings and revenues is pegged at $44.53 per share and $5.59 billion, respectively.
The Zacks Consensus Estimate for AZO’s fiscal fourth-quarter earnings per share has moved 16 cents south in the past seven days. The bottom-line projection, however, indicates year-over-year growth of 9.9%. The Zacks Consensus Estimate for quarterly revenues implies a 4.6% rise from the prior-year level.
The automotive parts retailer posted better-than-anticipated results in the last reported quarter. Earnings of $34.12 per share improved 17.5% from the prior-year figure and topped the Zacks Consensus Estimate of $30.84. Over the trailing four quarters, the company surpassed earnings estimates on all occasions, the average being 10.22%. This is depicted in the graph below:
Our proven model predicts an earnings beat for AutoZone this time around as well. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.
Earnings ESP: AutoZone has an Earnings ESP of +3.57%. This is because the Most Accurate Estimate is pegged $1.59 higher than the Zacks Consensus Estimate. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Sales growth in both retail DIY (‘Do-It-Yourself) and commercial DIFM (‘Do-It-For-Me) businesses is likely to have boosted the firm’s revenues during the to-be-reported quarter. AutoZone’s omni-channel efforts to improve customer shopping experiences are reaping profits. The company’s e-commerce efforts that are driving traffic to its website are likely to have positively impacted performance in the fourth quarter of fiscal 2023. We expect comps to grow 3.2% during the quarter under discussion, higher than 1.9% in the fiscal third quarter of 2023. Our projection for domestic store sales is pegged at $4.9 billion, implying an uptick of around 5% year over year.
Store expansion initiatives, fast delivery and high-quality products are also anticipated to have positively impacted the company’s top line in the fiscal fourth quarter. We expect the total store count at the end of the to-be-reported quarter to be 7,135, calling for a jump from the year-ago period’s 6,943.
However, doubling down on expansion with the opening of new distribution centers, mega hubs and stores might have strained near-term financials and operating margins. Further, AutoZone’s technology investments to improve the electronic catalog might have limited cash inflows in the to-be-reported quarter.
Peer Releases
O’Reilly Automotive, Inc. (ORLY - Free Report) reported second-quarter 2023 results on Jul 26. Its adjusted earnings per share of $10.22 beat the Zacks Consensus Estimate of $10.05. The bottom line increased from $8.78 in the prior-year quarter. The automotive parts retailer registered quarterly revenues of $4,069 million, beating the Zacks Consensus Estimate of $3,990 million. The top line increased 11% year over year. The total store count was 6,071 as of Jun 30, 2023.
ORLY had cash and cash equivalents of $57.9 million at the end of the reported quarter, down from $108.6 million recorded as of 2022-end. Its long-term debt was $4,873.7 million, higher than $4,371.6 million as of Dec 31, 2022.
Advance Auto Parts, Inc. (AAP - Free Report) reported second-quarter 2023 results on Aug 23. Its adjusted earnings of $1.43 per share declined 62% from the year-ago quarter's figure. The reported figure also fell short of the Zacks Consensus Estimate of $1.72 per share. Advance Auto generated net revenues of $2,686 million, which topped the Zacks Consensus Estimate of $2,671 million and increased 0.8% year over year.
Advance Auto had cash and cash equivalents of $277.1 million as of Jul 15, 2023, compared with $269.3 million on Dec 31, 2023. Total long-term debt was $1,785.1 million as of Jul 15, 2023, up from $1,188.3 million on Dec 31, 2022.
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Will AutoZone (AZO) Sustain Its Beat Streak in Q4 Earnings?
AutoZone (AZO - Free Report) is slated to release fourth-quarter fiscal 2023 results on Sep 19, before the opening bell. The Zacks Consensus Estimate for the quarter’s earnings and revenues is pegged at $44.53 per share and $5.59 billion, respectively.
The Zacks Consensus Estimate for AZO’s fiscal fourth-quarter earnings per share has moved 16 cents south in the past seven days. The bottom-line projection, however, indicates year-over-year growth of 9.9%. The Zacks Consensus Estimate for quarterly revenues implies a 4.6% rise from the prior-year level.
The automotive parts retailer posted better-than-anticipated results in the last reported quarter. Earnings of $34.12 per share improved 17.5% from the prior-year figure and topped the Zacks Consensus Estimate of $30.84. Over the trailing four quarters, the company surpassed earnings estimates on all occasions, the average being 10.22%. This is depicted in the graph below:
AutoZone, Inc. Price and EPS Surprise
AutoZone, Inc. price-eps-surprise | AutoZone, Inc. Quote
What Does Our Model Say?
Our proven model predicts an earnings beat for AutoZone this time around as well. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.
Earnings ESP: AutoZone has an Earnings ESP of +3.57%. This is because the Most Accurate Estimate is pegged $1.59 higher than the Zacks Consensus Estimate. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: AutoZone currently carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Things to Note
Sales growth in both retail DIY (‘Do-It-Yourself) and commercial DIFM (‘Do-It-For-Me) businesses is likely to have boosted the firm’s revenues during the to-be-reported quarter. AutoZone’s omni-channel efforts to improve customer shopping experiences are reaping profits. The company’s e-commerce efforts that are driving traffic to its website are likely to have positively impacted performance in the fourth quarter of fiscal 2023. We expect comps to grow 3.2% during the quarter under discussion, higher than 1.9% in the fiscal third quarter of 2023. Our projection for domestic store sales is pegged at $4.9 billion, implying an uptick of around 5% year over year.
Store expansion initiatives, fast delivery and high-quality products are also anticipated to have positively impacted the company’s top line in the fiscal fourth quarter. We expect the total store count at the end of the to-be-reported quarter to be 7,135, calling for a jump from the year-ago period’s 6,943.
However, doubling down on expansion with the opening of new distribution centers, mega hubs and stores might have strained near-term financials and operating margins. Further, AutoZone’s technology investments to improve the electronic catalog might have limited cash inflows in the to-be-reported quarter.
Peer Releases
O’Reilly Automotive, Inc. (ORLY - Free Report) reported second-quarter 2023 results on Jul 26. Its adjusted earnings per share of $10.22 beat the Zacks Consensus Estimate of $10.05. The bottom line increased from $8.78 in the prior-year quarter. The automotive parts retailer registered quarterly revenues of $4,069 million, beating the Zacks Consensus Estimate of $3,990 million. The top line increased 11% year over year. The total store count was 6,071 as of Jun 30, 2023.
ORLY had cash and cash equivalents of $57.9 million at the end of the reported quarter, down from $108.6 million recorded as of 2022-end. Its long-term debt was $4,873.7 million, higher than $4,371.6 million as of Dec 31, 2022.
Advance Auto Parts, Inc. (AAP - Free Report) reported second-quarter 2023 results on Aug 23. Its adjusted earnings of $1.43 per share declined 62% from the year-ago quarter's figure. The reported figure also fell short of the Zacks Consensus Estimate of $1.72 per share. Advance Auto generated net revenues of $2,686 million, which topped the Zacks Consensus Estimate of $2,671 million and increased 0.8% year over year.
Advance Auto had cash and cash equivalents of $277.1 million as of Jul 15, 2023, compared with $269.3 million on Dec 31, 2023. Total long-term debt was $1,785.1 million as of Jul 15, 2023, up from $1,188.3 million on Dec 31, 2022.
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