AutoZone is a retailer and distributor of automotive replacement parts and accessories in the United States. The company offers various products for cars, sport utility vehicles, vans, and light trucks, including new and remanufactured automotive hard parts, maintenance items, accessories, and non-automotive products. The company was founded in 1979 and is based in Memphis, Tennessee.
AZO Price Forecast Based on DCF Valuation
DCF Fair Value Target:
Below please find a table outlining a discounted cash flow forecast for AZO, in which we model out valuation assuming a variety of terminal growth rates. To summarize, we found that Autozone Inc ranked in the 45th percentile in terms of potential gain offered. We should note, though, that all scenearios modelled for this stock suggest it is overvalued. The most interesting components of our discounted cash flow analysis for Autozone Inc ended up being:
The company has produced more trailing twelve month cash flow than 92.45% of its sector Consumer Cyclical.
Autozone Inc's weighted average cost of capital (WACC) is 8%; for context, that number is higher than merely 16.01% of tickers in our DCF set.
AZO's estimated cost of debt, based largely on its market capitalization and its interest coverage ratio, is 2%; for context, that number is higher than merely 16.01% of tickers in our DCF set.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
Want more companies with a valuation profile/forecast similar to that of Autozone Inc? See LCII, WOW, BWA, CAL, and LOCO.
Bank of America is out with thoughts on the $300 billion aftermarket auto parts and repair market based on survey results. The Takeaways: Suzuki highlights four large companies in the auto parts market in AutoZone (NYSE: AZO ), O’Reilly Automotive (NASDAQ: ORLY ), Advance Auto Parts (NYSE: AAP ) and Genuine Parts Company (NYSE: GPC ). “The US automotive parts and repair market is large, stable, highly profitable (versus other segments of the auto value chain, and relatively fragmented,” analyst Elizabeth … Full story available on Benzinga.com
(Seeking Alpha welcomes back Andrew Shapiro, Founder and Portfolio Manager at Lawndale Capital Management. You can learn more about Andrew here.) Mace Security International (OTCQX:OTCQX:MACE) is a manufacturer and provider of personal safety and security products to the consumer and law enforcement markets worldwide. Mace is headquartered and manufactures its...
Andrew Shapiro on Seeking Alpha | September 25, 2020