Evercore ISI upgrades rating of Autozone, citing 'attractive' entry point – Yahoo Finance

Investing.com — A recent decline in AutoZone's (NYSE:AZO) share price since reporting lower-than-expected third-quarter sales gives the stock a more "attractive entry point," analysts at Evercore ISI said in a note.
The analysts upgraded their rating of the auto parts retailer to "outperform" from "in line" and hiked their target price to $2700 from $2640.
"We like [Autozone]’s [U.S. dollar] cash flow, small ticket exposure, and mild cyclicality with trade down positioning and share gain to keep the earnings compounding," the analysts wrote. "While [Autozone] is not immune to macro headwinds, we do see upside to Street estimates for a historical market leader."
Shares in Autozone added a little under 2% in early trading on Monday, but have dropped by more than 11% over the past one-month period.
The Nevada-based company was hit by a 7.4% increase in its inventory in the quarter ended May 6, while growth in domestic same-store sales slowed to 1.9%.
Higher input costs and supply chain constraints have forced many auto suppliers in the U.S. to hike the pricetags of their products. However, inflation-conscious consumers are pulling back spending on non-discretionary items in a bid to protect their wallets.
Related Articles
Evercore ISI upgrades rating of Autozone, citing 'attractive' entry point
Lockheed Martin collaborates with GlobalFoundries to secure defense chip supply
German stocks lead gains in Europe, all eyes on central bank meetings


Leave a Reply

Your email address will not be published. Required fields are marked *

Back To Top