AutoZone tops profit forecasts but revenue falls short in fourth quarter
Per-share earnings of $56.05 beat estimates as the company kept up an aggressive pace of share buybacks
Published
AutoZone reported fourth-quarter earnings per share of $56.05, ahead of Wall Street's target, while revenue of $6.59 billion fell short of the $6.78 billion analysts had expected. Consensus estimates compiled by TradingView had put EPS at $54.08, according to FactSet data cited by TradingView, against $48.71 a year earlier.
Analysts had also been looking for higher revenue than the company delivered. TipRanks said Wall Street had projected $6.70 billion for the quarter, up from $6.24 billion a year earlier. Ahead of the results, several banks trimmed their price targets on the stock: Oppenheimer's Brian Nagel cut his to $3,500 from $4,300, citing pressure on DIY car-parts demand from higher oil prices, according to TipRanks. Wells Fargo, Barclays and Citi also lowered their targets in the run-up to the report, according to a summary from Ad Hoc News. AutoZone shares had closed at $2,859.61 on September 19, near a 52-week low, and were down 13.6% for the year, Ad Hoc News reported.
Chief executive Phil Daniele said sales strengthened over the second half of the quarter after a difficult start, and that he expects sales to accelerate in each of AutoZone's three markets in fiscal 2027. The company repurchased 223,000 shares for $697.5 million during the quarter and had $1.6 billion left under its buyback authorization at year end.
The results were mixed: a wide beat on profit paired with a shortfall on revenue, a combination that points to cost control and efficiency rather than stronger demand. Daniele's optimism about an acceleration next year is notable, but the fact that this quarter's improvement came only after a weak start suggests the underlying trend is uneven rather than a clear turnaround. The scale of the buybacks shows management's confidence in the stock, but the revenue miss leaves open the question of whether the promised acceleration in sales will actually show up in the numbers next year.