AutoZone (AZO) Stock Forecast & Price Target

AutoZone demonstrated a robust financial performance with a 3.9% increase in average ticket values, primarily driven by a 2.8% inflation on like-for-like same SKUs and an enhanced product mix. The company's domestic Do-It-Yourself (DIY) sales also remained strong, as evidenced by a 2.2% increase in same-store sales (SSS) in Q4. Furthermore, the Domestic Commercial (DIFM) business experienced a significant 6% sales growth, reflecting a sequential acceleration from previous quarters, indicating continued positive momentum in both consumer segments.

AutoZone's financial outlook has been negatively impacted by a downward revision to its earnings per share (EPS) estimate, which has been adjusted to $153.58 for FY26, reflecting a slowdown from a previous forecast of $170.00. This adjustment is primarily driven by a reduction in the EBIT margin from 19.5% to 18.0%, largely due to increased store growth-related expenses and significant LIFO charges totaling approximately $360 million. Despite maintaining in-line sales figures in Q4, lower EPS results indicate potential challenges in profitability that could affect future financial performance.