AutoZone (NYSE:AZO) authorized an additional $1.5 billion share repurchase plan. This move reflects AZO’s commitment to enhancing shareholders’ value. Moreover, it highlights AutoZone’s ability to consistently grow its earnings and cash flows, enabling share buybacks and investments in growth initiatives.
AutoZone retails and distributes automotive parts and accessories. AZO has managed to consistently grow its earnings despite macro headwinds. (See the graph below.)
AutoZone’s Share Repurchases
AutoZone is known for consistently repurchasing shares without hampering its investments in existing assets and growth initiatives. The company has continued to invest in hubs and mega-hubs, thereby growing its international footprint. Further, AutoZone has allocated capital towards merchandise improvement and technological advancements.
Thanks to its disciplined capital allocation strategy, AutoZone has repurchased shares worth $36.3 billion since the inception of the repurchase program in 1998. Further, it repurchased 905.4 thousand shares at an aggregate cost of $2.5 billion during the thirty-six-week period ending May 4, 2024.
As for the Q3, it repurchased shares worth $735 million and had $1.4 billion remaining under the share buyback authorization.
Is AutoZone a Good Stock to Buy Now?
AutoZone remains committed to driving long-term shareholder value by investing in growth initiatives and returning excess cash to shareholders. AZO focuses on expanding its market share, enhancing margins, and improving its competitive positioning. Thanks to these positives, Wall Street is bullish about AutoZone’s prospects.
With 15 Buys and three Hold recommendations, AutoZone stock has a Strong Buy consensus rating. AZO stock is up about 15% year-to-date. The analysts’ average AZO stock price target is $3,197, implying 7.69% upside potential from current levels.
