Oppenheimer Thinks AutoZone’s Stock is Going to Recover

By Austin Angelo

In a report released today, Brian Nagel from Oppenheimer reiterated a Buy rating on AutoZone (NYSE: AZO), with a price target of $900. The company’s shares closed yesterday at $659.49, close to its 52-week low of $657.99.

Nagel wrote:

“We look upon the softer than Street fiscal Q3 (ended May 6th) results that AutoZone (AZO) reported today as unnerving, but not shocking, at least not to us. Several weeks ago, we issued our typical quarterly outlook report for the Hardlines group and outlined expectations for likely weaker sales in the Aftermarket Auto Parts sector. We lowered our Q3 (May) comp forecast for AZO to flat to down 2%. Recall, comps at O’Reilly (ORLY) in Q1 (Mar.) tracked barely positive, and comps at Monro (MNRO) declined by a high single-digit rate. We believe that sales weakness in the category reflects a combination of unfavorable macro factors and not something larger.”

According to TipRanks.com, Nagel is a 3-star analyst with an average return of 1.1% and a 50.3% success rate. Nagel covers the Services sector, focusing on stocks such as Restoration Hardware Holdings Inc, Dick’s Sporting Goods, and Advance Auto Parts.

AutoZone has an analyst consensus of Moderate Buy, with a price target consensus of $842.50.

The company has a one year high of $819.54 and a one year low of $657.99. Currently, AutoZone has an average volume of 368.1K.

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AutoZone, Inc. engages in the provision of retail and a distribution of automotive replacement parts and accessories. It operates in the following segments: Auto Parts Locations and Others. The Auto Parts Locations segment is a retailer and distributor of automotive parts and accessories through the company’s stores in the United States, Puerto Rico, Mexico and Brazil. The Others segment includes ALLDATA, which produces, sells and maintains diagnostic and repair information software used in the automotive repair industry; E-commerce, which includes direct sales to customers through www.autozone.com; and AutoAnything, which includes direct sales to customers through www.autoanything.com. The company was founded by Joseph R. Hyde, III on July 4, 1979 and is headquartered in Memphis, TN.