AutoZone: EPS up 84% in the third quarter

  •   04/06/2021 - 13h48
  •   DEHOUI Lionel

AutoZone is a U.S.-based aftermarket automotive parts and accessories company. It has been one of the pioneers in the industry in the United States since its founding in 1979. The company has employees throughout the United States and is headquartered in Memphis, Tennessee, with over 1,200 employees. The company reported a significant increase in EPS in the third quarter.

AutoZone: EPS up 84% in the third quarter

Third Quarter Numbers

At the end of its activity in the third quarter of its fiscal year 2020/21, AutoZone posted a net income of $596.2 million. In other words, its net income is up 74% and equals $26.48 per share (or +84%). This EPS level is significantly above the market consensus.

In the same vein, the operating profit of the automotive equipment distributor amounted to $803.5 million. This represents a significant net growth of 63%. As a result, AutoZone's revenues also rose by 31.4% to $3.7 billion.

In the U.S. market alone, the automotive distribution group reported like-for-like revenue growth of 28.9% for the quarter.

Note: For the three months as a whole, the core business (DIY) of US-based AutoZone was again very strong. The professional business was an exceptionally strong performer with sales up 44%.


Recall EPS in the previous quarter (Q2 2020/21)

In early March this year, the US-based company disclosed the EPS recorded under the second quarter of fiscal 2020/21. Its Q2 net income stood at $345.9 million, up 15.6%. This equates to $14.93 per share and an increase of 20.5%. This quarter also saw operating income of $481.8 million, an increase of 18.1%.

The growth momentum is also seen in the automotive equipment distribution company's revenue. In the second quarter of the 2020/21 financial year, they peaked at $2.9 billion, up 15.8%. The group's US operations alone posted like-for-like growth of 15.2%.

As a result, the company's gross margin fell 77 basis points to 53.6%.

Note: AutoZone Group reported very strong retail sales in Q2 FY2021. This performance was supported by government relief measures as well as changes in consumer behaviour due to the health crisis.


AutoZone developments

In recent trading, AutoZone shares have fallen 2.3% to $1,414.63. Since the beginning of this new year, shares are showing a 20% increase. Over the past 12 months, they are up 25%.

AutoZone has posted encouraging results since the beginning of the current fiscal year, marked by a steady growth dynamic. Indeed, auto parts retailers are the biggest beneficiaries of the health crisis period. In fact, the demand for auto repair has increased due to the government's stimulus checks.