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Memphis, Tennessee-based AutoZone, Inc. (AZO) operates as a retailer and distributor of automotive replacement parts and accessories. Valued at $62.1 billion by market cap, the company offers an extensive product line for cars, sport utility vehicles, vans, and light trucks, including new and remanufactured automotive hard parts, maintenance items, accessories, and non-automotive products.
Shares of this auto parts retailer have underperformed the broader market over the past year. AZO has gained 10% over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 13%. However, in 2026, AZO stock is up 10.5%, surpassing the SPX’s marginal rise on a YTD basis.
Narrowing the focus, AZO’s underperformance is also apparent compared to the SPDR S&P Retail ETF (XRT). The exchange-traded fund has gained about 14.1% over the past year. However, AZO’s low double-digit returns on a YTD basis outshine the ETF’s 4% gains over the same time frame.
AutoZone's underperformance was driven by a $98 million non-cash LIFO charge affecting margins and earnings. Weather disruptions and lack of prior-year hurricane-related sales also impacted retail trends.
For the current fiscal year, ending in August, analysts expect AZO’s EPS to grow 2.9% to $149.02 on a diluted basis. The company’s earnings surprise history is disappointing. It missed the consensus estimates in each of the last four quarters.
Among the 29 analysts covering AZO stock, the consensus is a “Strong Buy.” That’s based on 20 “Strong Buy” ratings, two “Moderate Buys,” and seven “Holds.”
This configuration is less bullish than a month ago, with 21 analysts suggesting a “Strong Buy.”
On Feb. 20, Citigroup Inc. (C) analyst Steven Zaccone reiterated a “Buy” rating on AZO and set a price target of $4,200, implying a potential upside of 12% from current levels.
The mean price target of $4,251 represents a 13.4% premium to AZO’s current price levels. The Street-high price target of $4,800 suggests a notable upside potential of 28.1%.
