AutoZone (AZO) Stock Drops Despite Market Gains: Important Facts to Note

In the latest close session, AutoZone (AZO) was down 1.06% at $2,934.52. The stock fell short of the S&P 500, which registered a gain of 0.46% for the day. On the other hand, the Dow registered a gain of 0.56%, and the technology-centric Nasdaq increased by 0.45%.

Shares of the auto parts retailer witnessed a loss of 2.05% over the previous month, beating the performance of the Retail-Wholesale sector with its loss of 3.73%, and underperforming the S&P 500's gain of 2%.

The investment community will be closely monitoring the performance of AutoZone in its forthcoming earnings report. The company is scheduled to release its earnings on September 22, 2026. It is anticipated that the company will report an EPS of $54.97, marking a 12.85% rise compared to the same quarter of the previous year. Alongside, our most recent consensus estimate is anticipating revenue of $6.71 billion, indicating a 7.52% upward movement from the same quarter last year.

Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $150.98 per share and revenue of $20.48 billion, indicating changes of +4.22% and +8.13%, respectively, compared to the previous year.

Additionally, investors should keep an eye on any recent revisions to analyst forecasts for AutoZone. Such recent modifications usually signify the changing landscape of near-term business trends. Therefore, positive revisions in estimates convey analysts' confidence in the business performance and profit potential.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the past month, there's been a 0.08% fall in the Zacks Consensus EPS estimate. At present, AutoZone boasts a Zacks Rank of #4 (Sell).

From a valuation perspective, AutoZone is currently exchanging hands at a Forward P/E ratio of 16.9. This represents a discount compared to its industry average Forward P/E of 17.17.

It's also important to note that AZO currently trades at a PEG ratio of 1.48. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Automotive - Retail and Wholesale - Parts stocks are, on average, holding a PEG ratio of 2.18 based on yesterday's closing prices.

The Automotive - Retail and Wholesale - Parts industry is part of the Retail-Wholesale sector. With its current Zacks Industry Rank of 74, this industry ranks in the top 31% of all industries, numbering over 250.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow AZO in the coming trading sessions, be sure to utilize Zacks.com.

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This article originally published on Zacks Investment Research (zacks.com).

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