AZO - AutoZone is recommended at Morgan Stanley as powerful self-help story stock

Morgan Stanley upgraded AutoZone (NYSE:AZO) to an Overweight rating after having the retailer slotted at Equal-weight. The firm thinks that AZO offers ~20% upside with an attractive ~3:1 bull/bear skew. Analyst Simeon Gutman and team have more conviction in the durability of AZO's sales/earnings growth than for other do-it-yourself auto peers. "AZO is a self-help story (its commercial playbook is working), the business has a history of prudent expense management, and DIY Auto is a defensive category. These factors enhance AZO's earnings visibility amid an uncertain macro backdrop. In addition, we are confident in AZO's pricing power and think there is more DIFM upside from the mega hub strategy." In regard to valuation, the mid- to high-teens P/E is called justified given AZO's track record of execution, increasing exposure to the higher-growth DIFM segment, and historical premium to the market during economic slowdowns. AZO is noted to be trading at

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AutoZone is recommended at Morgan Stanley as powerful self-help story stock