- Citigroup is strongly recommending buying AutoZone's (NYSE:AZO) stock ahead of their fourth quarter earnings release on Tuesday, September 19th. Firm is modelling EPS of $2.81, two cents above consensus, and believes their may be upside to their est. Notes their call is non-consensus & proprietary supporting stk apprec. on earnings day.
EPS upside will likely be driven by higher than expected GMs & mgm't will likely point to the sustainability of the improvement going forward. Re-negotiated supply agreements in fiscal 3Q will be the primary driver.
Mgm't will also likely indicate that a successful roll out of a new commercial biz model is driving DIFM comps up in the mid to high-teens in stores with the new program. Less than half of the stores have currently seen the rollout.
Share buybacks will likely exceed expectations. They believe share repurchases reflect the tremendous FCF generation of AZO even in a tough macro environment. AZOs model supports sales leverage in a lower comp environm't.
Reits Buy and $124 tgt.
Notablecalls: Well at least they have conviction! Would not be surprised to see couple of points of upside over the next 2 days.
EPS upside will likely be driven by higher than expected GMs & mgm't will likely point to the sustainability of the improvement going forward. Re-negotiated supply agreements in fiscal 3Q will be the primary driver.
Mgm't will also likely indicate that a successful roll out of a new commercial biz model is driving DIFM comps up in the mid to high-teens in stores with the new program. Less than half of the stores have currently seen the rollout.
Share buybacks will likely exceed expectations. They believe share repurchases reflect the tremendous FCF generation of AZO even in a tough macro environment. AZOs model supports sales leverage in a lower comp environm't.
Reits Buy and $124 tgt.
Notablecalls: Well at least they have conviction! Would not be surprised to see couple of points of upside over the next 2 days.
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