AutoZone, Inc. (NYSE:AZO) Earnings Report Analysis and Financial Health
AutoZone, Inc. (NYSE:AZO) is a leading retailer and distributor of automotive replacement parts and accessories in the United States. The company operates in the Zacks Automotive – Retail and Wholesale – Parts industry, competing with other major players like O’Reilly Automotive and Advance Auto Parts. AutoZone’s business model focuses on providing a wide range of products for both professional mechanics and do-it-yourself customers.
On March 4, 2025, AutoZone reported earnings per share (EPS) of $28.29, which was below the estimated $29.05. This represents a negative surprise of 2.98%, as highlighted by Zacks. The EPS also decreased from $28.89 in the same quarter last year. In the previous quarter, AutoZone reported an EPS of $32.52, missing the expected $33.54, resulting in a 3.04% negative surprise. Over the past four quarters, AutoZone has exceeded consensus EPS estimates only once.
AutoZone’s revenue for the quarter ending February 2025 was $3.95 billion, slightly below the estimated $3.98 billion, marking a 0.89% shortfall according to Zacks. Despite this, the revenue showed a slight increase from $3.86 billion reported a year ago. The company has surpassed consensus revenue estimates only once in the last four quarters. AutoZone’s stock declined following its fourth consecutive revenue miss, despite strong performance in the U.S. market.
The company faces challenges from cautious consumer spending and currency rate fluctuations, impacting its ability to meet revenue expectations. AutoZone’s international business, however, continues to perform well and remains a source of encouragement. The company’s price-to-earnings (P/E) ratio is approximately 22.02, indicating the market’s valuation of its earnings, while its price-to-sales ratio is about 3.10, reflecting the market’s valuation of its revenue.
AutoZone’s financial metrics provide insights into its valuation and financial health. The enterprise value to sales ratio is around 3.74, and the enterprise value to operating cash flow ratio is approximately 23.28. The earnings yield is about 4.54%, offering a perspective on the return on investment. The company has a negative debt-to-equity ratio of approximately -0.70, suggesting a higher level of liabilities compared to its equity. Additionally, AutoZone’s current ratio is approximately 0.83, indicating its ability to cover short-term liabilities with short-term assets.
