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2016-09-19

  • Dr. Paul Price commented on Robert Abbott's article 09-19 10:51
    AutoZone: Debt Is a Dragging Brake on This Muscle Car
    On Thursday, Sept. 22, AutoZone Inc. (AZO), one of the big four auto parts retailers, will release its fourth quarter and fiscal 2016 earnings. With...
    View all 5 comments
    Dr. Paul Price 09-19 11:51
    • Better check your numbers on those AZO insider sells.

      An Executive VP sold 17,230 shares all by himslef on Aug. 11, 2016 for almost $1.8. There have been many other insider sales much larger than that.

      Since 2011 there were hundreds of insider sells, for huge dollar amounts, against almost no buys. 

      The company's problem will come one day when they are forced to repay principal (rather than just refinance interest) and they have no ability to roll-over the debt due to lack of people willing to lend to them. See Greece, Cyprus, Iceland, Ireland etc for examples of what happens on those occasions.

      The Fed or IMF are not going to bail out AZO's shareholders, or bondholders when that happens.

       

       

       

       

       

2016-09-16

  • Dr. Paul Price commented on Robert Abbott's article 09-16 16:03
    AutoZone: Debt Is a Dragging Brake on This Muscle Car
    On Thursday, Sept. 22, AutoZone Inc. (AZO), one of the big four auto parts retailers, will release its fourth quarter and fiscal 2016 earnings. With...
    View all 1 comment
    Dr. Paul Price 09-16 17:03
    • As of the end of FY 2016 (ended Aug. 27, 2016) AZO had negative equity of about d.59.65 per share. (Source: Value Line) The firm's debt to equity ratio is not calculable. Management is using ever increasing shareholder debt to buy back shares, often from themselves.

      AZO is a bankruptcy waiting to happen whenever interest rates surge or anything worse than a mild recession takes hold. 

      Caveat emptor.

       

       

       

       

       

2016-09-14

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