Winning With AutoZone

Dec. 07, 2018 1:44 PM ETAutoZone, Inc. (AZO)3 Comments


  • After a 40% plus rally from our call a few months ago, shares are pulling back with market volatility.
  • Fiscal 2019 is off to a strong start and we are closely watching comp sales as well as investments into mobile going forward.
  • Key indicators remain strong and the name is growing earnings at an amazing rate, fueled in part by an ongoing repurchase program.
  • A quality company at a fair price.
  • Looking for a community to discuss ideas with? BAD BEAT Investing features a chat room of like-minded investors sharing investing ideas and strategies. Start your free trial today »

AutoZone (NYSE:AZO) is a name that is a reliable trade, though as an investment it tends to peak and then pull back. Over at BAD BEAT Investing, we put out a buy alert a few months ago on this stock and said plainly there was a major opportunity in the name under $600. The stock has now rallied well over 40%. However, the name is once again pulling back, and this compels us to revisit the name. With the company having just reported earnings, which suggests the future is bright, we think a potential entry point to get back into the name could be approaching during this volatile time in the stock market. Our sentiment is bullish, but let the name pull back for a better price.

In the present column, we will discuss several aspects of the company that we believe suggests there is value in this name once again following the sell-off the stock is experiencing. While the competition has been gaining some market share in the retail space according to IBIS data (subscription required to see full data), AutoZone still has an opportunity to control the commercial markets in our opinion and potential investors should focus here. Further, the company continues its tremendous buyback which ensures additional earnings per share growth. We believe that as the stock retraces toward $800, investors should closely follow the name, and consider acquiring shares of this quality company at a fair price.

Our thoughts on fiscal Q1 performance

In our opinion this sell-off is being driven by the macro environment and the fact that the DOW is down 1500 points in two sessions. Let folks take profits here and be prepared to start stepping in around $800. The company is crushing sales expectations and even exceeding our bullish margin expectations on the back of

Looking for more rapid-return trade ideas like this? We have 3 spots open in our top performing trading service at 50% off

Signup now, and pay 50% off the regular rate that big money traders pay for access to our team.

Just $1.22 per day. One trade pays for years of the service.

What we do for you:

Find beaten-down stocks and profit from their reversals.

Defensive and speculative plays discussed in chat

2-3 swing trades a week, monthly deep value plays.

Guided entry and exits.

Oh, and it's Free to try for two weeks. What are you waiting for?

This article was written by

Quad 7 Capital profile picture
The #1 service for high performing trades run by active hedge fund analysts

We have turned thousands of losing investors into WINNERS. We are the team behind the top performing trading service BAD BEAT Investing. Quad 7 Capital was founded in 2017 by a team that consists of a long time investor, health researcher, financial author, professor, professional cardplayer, and a politician. 

The BAD BEAT Investing service launched in 2018 and is a top performing Marketplace service relative to market returns. It is focused on extreme value, and leveraging mispriced stocks and momentum driven events for rapid return swing trades, options education, and long-term investments. Further, it offers a direct access line to our traders all day during market hours.

Quad 7 Capital as a whole has expertise in business, policy, economics, mathematics, game theory and the sciences. The company has experience with government, academia, and private industry. We offer market opinion and analysis, and we cover a wide range of sectors and companies, with particular emphasis on news related items and analyses on growth companies, cryptocurrencies, REITS, biotechnology/ pharmaceuticals, precious metals, blue chips and small-cap companies.

If you want to win, follow us, and if you want to make money, sign up to BAD BEAT investing today. 

Disclosure: I/we have no positions in any stocks mentioned, but may initiate a long position in AZO over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Additional disclosure: We recently took profit as outlined with our trading service, but plan to reenter under $800

Recommended For You

Comments (3)

To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.
Is this happening to you frequently? Please report it on our feedback forum.
If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.