AutoZone (ticker: AZO) said it earned $18.61 a share from revenue that rose nearly 13% to $3.154 billion. Analysts were looking for EPS of $17.82, and revenue of $3.147 billion.
Same-store sales climbed 12.3% in the period, just ahead of the 12% consensus estimate. AutoZone said it opened more than 40 stores in the period.
AutoZone was down 2.1% to $1,133 in early trading.
Although the company turned in a decent quarter, investors were probably hoping for revenue and same-store sales to come out farther ahead of expectations than they did, as assurance that the company can hold on to recent gains. That is a concern for many retailers.
Auto-parts retailers and suppliers as a whole have struggled with the Covid-19 pandemic. AutoZone,
Genuine Parts Co.
(GPC) and Monro (MNRO) are all in the red for 2020, while
(ORLY) has eked out a 2% gain.
The closures of schools, offices, and entertainment destinations means that fewer people are on the road, and fewer miles driven lead to fewer repairs. At the same time, though, economic uncertainty has led many people to repair their cars rather than buy new ones.
Double-digit comparative sales growth in recent quarters from the companies attest to a boost as Americans drive more than they did in the spring, while not being willing to part with their older vehicles.
Investors have been hoping that the sector’s strong showing over the summer would continue into autumn, helping the companies play catch-up after a difficult spring.
Through this lens, AutoZone’s quarter could be seen as lacking. Top-line results were only in line with expectations, rather than exceeding them. And comparable-store sales growth slowed quite a bit, from nearly a nearly 22% increase in its prior quarter—more than double expectations—to just over 12%.
Write to Teresa Rivas at firstname.lastname@example.org