johngonole

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In normal times with this type of growth prospect this might be a fair value. While the downturn may indeed broaden their customer base they are highly leveraged as you state. Any missteps and this company could find itself in real trouble.

Long term people are more likely to put off the cosmetic or no urgent repair needs sometime way into the future. On the low end of the socio-economic scale people might even put off getting their air fixed.

So while sales may increase I think its short term. More middle class buyers but fewer lower income buyers as they put off repairs and even give up their cars.

On the otherhand I don't think bankrupcy is in their future since cash flow is strong.

There are better values to be had. I'd certainly buy EBAY, DELL, or MSFT here versus AZO long term. Cheaper, stronger balance sheets, and better overall growth prospects.