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Key Takeaways
- AutoZone posted quarterly revenue and profit that exceeded analysts’ expectations.
- The company got a lift from increased merchandise profit margins and lower supply chain expenses.
- The news sent shares of the auto parts retailer nearly 7% higher to their all-time high Tuesday.
AutoZone (AZO) shares rose to an all-time high Tuesday after the auto parts retailer reported revenue and profit that topped analysts’ expectations.
The company reported second-quarter fiscal 2024 diluted earnings per share of $28.89, up from $24.64 in the year-ago period, as net income rose 8.1% to $515.0 million. Revenue rose 4.6% to $3.86 billion as same store sales increased 3% in the year-on-year comparison.
AutoZone’s gross margin increased 160 basis points (bps) to 53.9% in the fiscal second quarter, which ended on Feb. 10. The company said it benefited from higher merchandise profit margins, a non-cash last in, first out (LIFO) favorability, and reduced supply chain costs.
CEO Phil Daniele said the results were strong even as AutoZone faced “a difficult holiday comparison for both Christmas and New Year’s” in sales.
AutoZone noted it added 19 new stores in the U.S. (closing three), six in Mexico, and four in Brazil for a net addition of 26. As of Feb. 10, the retailer had a total of 7,191 locations: 6,332 in the U.S., 751 in Mexico, and 108 in Brazil.
Shares of AutoZone rose 6.7% to close Tuesday at $2,954.99. The stock has gained 15% since the start of the year.