AutoZone, Inc. (NYSE: AZO) stock rises on decent performance

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AutoZone, Inc. (NYSE: AZO) stock rose over 0.023% on May 26th, 2020 (as of 4:16 pm GMT-4; Source: Google finance) after the company posted better than expected results for the third quarter of FY 20. Net income for the quarter fell to $342.9 million from $405.9 million in the year-ago period. The first four weeks, the sales, were as anticipated, and were quite strong with same-store sales up more than 6%. Both retail and commercial were performed quite well with commercial sales growth returning comfortably to double digits. During the second four weeks, the sales performance had immediately declined materially, falling to a one-week low of comps down more than 25%. Overall, the same-store sales decreased by 1% compared to last year’s third quarter. During the third quarter, the company had opened two new stores and finished with 610 stores. For the third quarter, the company had generated $651 million of operating cash flow. Net fixed assets had increased 1.4% versus last year. Capital expenditures for the quarter were of total $83.3 million and reflected the additional expenditures required to open 23 net new stores this quarter.

Further, due to pandemic, the company immediately acted to deal with any liquidity concerns. The company had temporarily suspended the share repurchase program. Then the company issued $1.25 billion of bonds. The company had also closed on an additional 364-day $750 million line of credit. This additional a lot of credit was on top of the unutilized $2 billion line of credit already in place.

AZO in the third quarter of FY 20 has reported the adjusted earnings per share of $14.39, beating the analysts’ estimates for the adjusted earnings per share of $13.75, according to the FactSet consensus. The company had reported 0.1 percent fall in the adjusted revenue to $2.779 billion in the third quarter of FY 20, beating the analysts’ estimates for revenue by $2.69 billion. For the third quarter, the gross margin was up 2 basis points along with past storylines around tariffs, supply chain and mix between DIY and DIFM sales. EBIT for the quarter was $491,700,000 and the EBIT margin was 17.7%.

Moreover, for the third quarter, the total auto part sales, which includes the domestic Mexico and Brazil stores, rose by 0.3%. For the trailing four quarters, total sales per AutoZone store were $1,856,000 compared to an average of $1,814,000 at Q3 ending last year.

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