AZO
AutoZone, Inc.
$3,062.16
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Mild
·
Conviction
Overvalued
Trading 8.1% above fair value
You pay
$3,062.16
Bear
$2,477.62
Fair
$2,831.56
Bull
$3,185.52
Bear
$2,477.62
-19.1%
$144.87 × 14x P/E
Fair
$2,831.56
-7.5%
$144.87 × 16x P/E
Bull
$3,185.52
+4.0%
$144.87 × 18x P/E
Key Value Driver
Normalized P/E multiple (16x base case)
Implied Market Multiple
21.1x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $3912.00 from 45 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $2831.56 per share.
Warnings
Wall Street's average price target is $3912.00 (from 45 analysts). Our estimate is 39% below the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples