InvestorsObserver gives Autozone Inc (AZO) a strong valuation score of 62 from its analysis. The proprietary scoring system considers the underlying health of a company by analyzing its stock price, earnings, and growth rate. AZO currently holds a better value than 62% of stocks based on these metrics. Long term investors focused on buying-and-holding should find the valuation ranking system most relevant when making investment decisions.
AZO gets a 62 Valuation Rank today. Find out what this means to you and get the rest of the rankings on AZO!
AZO has a trailing twelve month Price to Earnings (PE) ratio of 29.02. The historical average of roughly 15 shows a poor value for AZO stock as investors are paying higher share prices relative to the company's earnings. AZO's high trailing PE ratio shows that the firm has been trading above its fair market value recently. Its trailing 12-month earnings per share (EPS) of 141.71 does not justify the stock's current price. However, trailing PE ratios do not factor in the company's projected growth rate, resulting in many newer firms having high PE ratios due to high growth potential enticing investors despite inadequate earnings.
AZO has a 12 month forward PE to Growth (PEG) ratio of 1.69. Markets are overvaluing AZO in relation to its projected growth as its PEG ratio is currently above the fair market value of 1. 141.71's PEG comes from its forward price to earnings ratio being divided by its growth rate. PEG ratios are one of the most used valuation metrics due to its incorporation of more company fundamentals metrics and a focus on the firm's future rather than its past.
Summary
All together these valuation metrics paint a pretty poor picture for AZO at its current price due to a overvalued PEG ratio despite strong growth. The PE and PEG for AZO are worse than the average of the market resulting in a valuation score of 62.
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