AZO - AutoZone flags weaker than expected sales through spring

2023-05-23 07:08:47 ET

AutoZone ( NYSE: AZO ) shares wavered in premarket action as strong quarterly profits were balanced by slowing sales into the month of May.

The specialty retailer reported $4.1B in revenue for the fiscal third quarter while domestic same store sales increased 1.9% over the three month period. Net income for the quarter increased 9.3% year over year to $647.7M while diluted earnings per share increased 17.5% from Q3 2022 to $34.12. Analysts had expected $31.47 in earnings per share on $4.12B in revenue for the quarter. Comparable sales were expected to rise 4.09% in the quarter.

“While weaker than expected sales for the month of March meaningfully affected our results this quarter, we are excited about our initiatives and believe we are well positioned for future growth,” CEO Bill Rhodes said.

The company’s earnings release also noted a 7.4% increase in inventory increased year over year “driven by inflation and growth initiatives.” The company opened a total of 22 new stores in Q3.

Elsewhere, management updated the company’s buyback program, highlighting the repurchase of 356,000 shares for $908.2M in the quarter. A total of $843.M remains available under the current share repurchase authorization.

Shares of Autozone ( AZO ) slid 2.74% on light volume in premarket trading on Tuesday.

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• AutoZone: A Great Compounder To Keep An Eye On
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• Dig into the Seeking Alpha Quant Rating

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