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AutoZone Inc (NYSE:AZO)
Intrinsic Value (DCF Projected)
$327.98 (As of Today)

Since the intrinsic value calculations based on Discounted Cash Flow Intrinsic Value (DCF), or Discounted Earnings (DCE) Intrinsic Value (DE) cannot be applied to companies without consistent revenue and earnings, GuruFocus developed a valuation model based on normalized Discounted Cash Flow and Book Value of the company. The details of how we calculate the intrinsic value of stocks are described in detail here.

As of today, AutoZone Inc's DCF projected intrinsic value is $327.98. The stock price of AutoZone Inc is $537.78. Therefore, AutoZone Inc's Price to Intrinsic Value (DCF Projected) Ratio of today is 1.6.

AZO' s 10-Year Price to Intrinsic Value (DCF Projected) Range
Min: 0.77   Max: 78.94
Current: 1.64

0.77
78.94

During the past 13 years, the highest Price to Intrinsic Value (DCF Projected) Ratio of AutoZone Inc was 78.94. The lowest was 0.77. And the median was 1.39.

AZO's Price to Intrinsic Value (DCF Projected) is ranked higher than
74% of the 1174 Companies
in the Global Specialty Retail industry.

( Industry Median: 4.30 vs. AZO: 1.64 )

Definition

Since the intrinsic value calculations based on Discounted Cash Flow Intrinsic Value (DCF), or Discounted Earnings (DCE) Intrinsic Value (DE) cannot be applied to companies without consistent revenue and earnings, GuruFocus developed a valuation model based on normalized Discounted Cash Flow and Book Value of the company.

The details of how we calculate the intrinsic value of stocks are described in detail here.

This method smooths out the free cash flow over the past 6-7 years, multiplies the results by a growth multiple, and adds a portion of total equity.

Value = ((Growth Multiple)*Free Cash Flow(6 year avg) + 0.8*Total Equity(most recent))/Shares Outstanding

In the case of negative total equity, the following formula is used (see the Total Equity section for the reason):

Value = ((Growth Multiple)*Free Cash Flow(6 year avg) + Total Equity(most recent)/0.8)/Shares Outstanding


Here AutoZone Inc's FCF(6 year avg) is calculate as

AutoZone Inc Quarterly Data

201202201205201208201211201302201305201308201311201402201405
total_freecashflow 4824227623810329636427562361
200908200911201002201005201008201011201102201105201108201111
total_freecashflow 2771776032332031221364274280
200808200811200902200905
total_freecashflow 33090-40325

Add all the Free Cash Flow together and divide 6 will get AutoZone Inc's FCF(6 year avg) = $896.11.

AutoZone Inc's DCF Projected Intrinsic Value for today is calculated as

Intrinsic Value=(Growth Multiple*Free Cash Flow(6 year avg)+Total Equity(May14)/0.8)/Shares Outstanding
=(14.8626533105*896.111833333+-1808.23/0.8)/33.716
=327.98

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.


Explanation

The growth multiple is capped between 8.35 and 17.74.

Total equity weighting is more art than science and it should always be revisited in more detail when researching a company. Weightings from 0% to 100% to more than 100% are possible. 80% was chosen as a happy medium after taking the above ideas into consideration. Learn more here.

AutoZone Inc's Price to DCF Projected Intrinsic Value Ratio for today is calculated as

Price to DCF Projected Intrinsic Value=Share Price/DCF Projected Intrinsic Value
=537.78/327.984102689
=1.64

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.


Related Terms

Intrinsic Value (DE), Intrinsic Value (DCF), Free Cash Flow


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

AutoZone Inc Annual Data

Aug04Aug05Aug06Aug07Aug08Aug09Aug10Aug11Aug12Aug13
iv_dcf_share 59.5884.86101.40121.78129.38146.86178.40222.74253.26292.96

AutoZone Inc Quarterly Data

Feb12May12Aug12Nov12Feb13May13Aug13Nov13Feb14May14
iv_dcf_share 243.27247.84253.26265.04270.33283.72292.96307.63310.78327.98
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