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Summary

• AutoZone remains a defensive, all-weather compounder, now retracing after missing Q1 2026 revenue and EPS estimates.
• Despite modest 2.4% growth and slower buybacks, AZO’s international comps and cash generation remain strong, with $1.7B in repurchase authorization.
• Inflationary pressures and higher input costs reduced gross margin by 200 bps, while operating expenses rose to 34% of sales.
• At a forward P/E of 24 and EV/EBITDA of 17, AZO enters buy territory around $3,500, with further upside if international momentum persists.

M. Suhail/iStock Editorial via Getty Images

Introduction

AutoZone (AZO) represents a typical all-weather stock that has basically never failed its shareholders. Over the last few months, the stock has been retracing, and after the company released its Q1 2026 earnings, the stock is down almost 7% because

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**Analyst’s Disclosure:**I/we have no stock, option or similar derivative position in any of the companies mentioned, but may initiate a beneficial Long position through a purchase of the stock, or the purchase of call options or similar derivatives in AZO over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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