QualityDipStocks / Consumer Discretionary · Auto parts retail
AutoZone AZO
Not in a dip by our rules: 20% below its 52-week high.
A quality company trading well above our fair value estimate, 8% over its Market Value.
- Fair value est.
- $1,934−39%
- Market Value
- $2,947price +8%
- Off 52-wk high
- −20%
- Risk vs market
- Lowbeta 0.14
4 bullish · 5 bearish See why
Key levels
Every level vs today’s $3,170
- Fair value est.base case$1,934−39.0%
- 52-wk lowlowest close, 1 year$2,792−11.9%
- Market Valueavg paid since Sep 22$2,947−7.0%
- PriceFri Oct 30 close$3,170you are here
- 52-wk highhighest close, 1 year$3,968+25.2%
Fair value estimate
How the range is computed
Ten-year free-cash-flow DCF. Same 10-year free-cash-flow model as the base: discount rate 9.5% ±1 point and growth 5.2% ±2 points. Bear = 10.5% and 3.2%; bull = 8.5% and 7.2% (both fade to 3%). A model estimate from public filings, not a forecast of where the price will go.
Price is above even the bull case.
What the price implies To be worth today’s price, AZO’s free cash flow would need to grow about 14% a year for five years; our estimate uses 5%.
Risk vs market
How risk vs market is measured
One year of daily returns (Oct 30 to Oct 30, 252 sessions). Beta = how much AZO moved for each 1% move in the S&P 500 (SPY); 1.0 moves with the market. Volatility is the yearly standard deviation of daily returns. Past behavior, not a forecast.
Has moved mostly independently of the market, but its own price swings are 2.4× the S&P 500’s (it moves on its own news).
- Beta vs S&P 500
- 0.14
- Volatility
- 30% vs 13% SPY
- Correlation SPY
- 0.06
- Correlation QQQ
- −0.09
Bull vs bear
Rule-based from the data on this page, strongest first. Not advice.
Top bullish points 4 of 5
ProfitabilityReturn on invested capital of 47%, above the 9.5% discount rate our DCF uses.
Cash returnsShare count down 2.1% in a year: $2.0B of buybacks over 12 months.
ProfitabilityGross margin of 52%, above the 39% median for the 120 Consumer Discretionary companies we cover.
QualityPasses all four of our quality checks: cash generation, returns on capital, growth and balance sheet.
Top bearish points 5 of 5
ValuationOur DCF fair value estimate is $1,934, 39% below the price.
ProfitabilityOperating margin narrowed to 18.3% in FY2026 from 20.5% in FY2024 (SEC filings).
ValuationFree-cash-flow yield of 3.4%, below the 4.9% median for the 169 Consumer Discretionary companies we cover.
ValuationEV/EBITDA of 14.1×, above the 12.8× median for the 113 Consumer Discretionary companies we cover.
ValuationTrades 7.5% above its Market Value of $2,947, the average price paid since the Sep 22 filing.
Who’s talking about it
Notable investors, executives, analysts and public figures on AutoZone in the last 48 hours. Headlines as published, each linked. Their words, not ours.
No notable mentions in the last 48 hours. Checked Nov 1, 9:09 PM ET.
Compare with peers
Closest in size in Consumer Discretionary
All fundamentals
P/E 20.8 · FCF yield 3.4% · Sales +7%
Valuation
- P/E
- 20.8×3-yr-end avg 23.2× · Consumer Discretionary median 20.9×
- Price / FCF
- 29.4×
- FCF yield
- 3.4%
- EV / EBITDA
- 14.1×
- Price / sales
- 2.63×
- Price / book
- n/anot reported in its SEC filings
- Market cap
- $53.5Bprice × diluted shares
- Enterprise value
- $62.2B
Growth
- Revenue, 12 months
- $20.3B
- Sales growth, 12 months
- +7.4%vs the 12 months before
- Sales growth, 3 yrs
- +5.2%/yrfrom FY2023
- Diluted EPS, 12 months
- $152.55
- EPS growth, last FY
- +5.3%
- Net income, 12 months
- $2.6B
- Net income growth
- +3%12 months vs before
Profitability
- Gross margin
- 52.3%
- Operating margin
- 18.3%
- Net margin
- 12.6%
- FCF margin
- 8.9%
- Return on equity
- n/anegative shareholder equity
- Return on invested capital
- 47%
Balance sheet
- Cash & short-term inv.
- $326M
- Total debt
- $9.1B
- Net cash
- −$8.8B
- Debt / equity
- n/adebt or equity not tagged in SEC data
- Interest coverage
- 7.6×operating income / interest
Cash flow & returns
- Free cash flow, 12 months
- $1.8B
- FCF growth, 12 months
- +1%
- Dividend yield
- 0%
- Payout ratio
- n/anot reported in its SEC filings
- Buybacks, 12 months
- $2.0B3.8% of market cap
- Share count, 1 year
- −2.1%diluted shares vs a year ago
- Stock-based comp
- $137M
Trailing 12 months to Aug 29, 2026; balance sheet at Aug 29, 2026. From AutoZone’s SEC filings. Sparklines show up to six fiscal years. n/a means we don’t hold that number, with the reason. How each is computed.
Valuation details
DCF $1,934 · MV $2,947 · FCF value $2,856
Assumes 5.2% growth for 5 years (revenue grew 5.2% a year FY23–FY26), fading to 3%; 9.5% discount rate, 3% terminal growth. FCF base $107.65 a share (fiscal year to Aug 29, 2026), from the 10-K filed Oct 26, 2026. Net debt $8.8B, not deducted.
Setup & signals
No setup armed
No setup armed, so there’s no trigger or stop to track yet. Reversal signal rules only arm once a company is in a dip.
Momentum & 52-week range
RSI 61 · 5 days −1.0%
The business
FCF $1.8B · Sales +6%
- Free cash flow, 12 months$1.8B
- Free-cash-flow yield3.6%
- Free-cash-flow margin9%
- Gross margin52%
- Operating margin18%
- Return on invested capital45%
- Sales growth (latest quarter vs year-ago quarter)+6%
- Net debt / EBITDA2.8×
Information only, not investment advice. Fair value estimates and talking points are rule-based model output from public data and can be wrong; stop levels are reference points, not orders. How every number is computed.
Get a text when AZO fires a reversal signal
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