AutoZone (NYSE:AZO) Financial Strength

: 5 (As of Nov. 2022)

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AutoZone has the Financial Strength Rank of 5.

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors:

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.
2. Debt to revenue ratio. The lower, the better.
3. Altman Z-Score.

AutoZone's Interest Coverage for the quarter that ended in Nov. 2022 was 12.53. AutoZone's debt to revenue ratio for the quarter that ended in Nov. 2022 was 0.59. As of today, AutoZone's Altman Z-Score is 2.91.

Competitive Comparison

For the Specialty Retail subindustry, AutoZone's Financial Strength, along with its competitors' market caps and Financial Strength data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Annual Data Quarterly Data

AutoZone Financial Strength Distribution

For the Retail - Cyclical industry and Consumer Cyclical sector, AutoZone's Financial Strength distribution charts can be found below:

* The bar in red indicates where AutoZone's Financial Strength falls in comparison to its industry or sector. The grey bar indicates the Financial Strength's extreme value range as defined by GuruFocus.

AutoZone Financial Strength Calculation

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors

A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

AutoZone's Interest Expense for the months ended in Nov. 2022 was $-58 Mil. Its Operating Income for the months ended in Nov. 2022 was $723 Mil. And its Long-Term Debt & Capital Lease Obligation for the quarter that ended in Nov. 2022 was $9,167 Mil.

AutoZone's Interest Coverage for the quarter that ended in Nov. 2022 is

Interest Coverage	=	-1	*	Operating Income (Q: Nov. 2022 )	/	Interest Expense (Q: Nov. 2022 )
	=	-1	*	723.033	/	-57.723
	=	12.53

The higher the ratio, the stronger the company's financial strength is.

2. Debt to revenue ratio. The lower, the better.

AutoZone's Debt to Revenue Ratio for the quarter that ended in Nov. 2022 is

Debt to Revenue Ratio	=	Total Debt (Q: Nov. 2022 )			/	Revenue
	=	(Short-Term Debt & Capital Lease Obligation	+	Long-Term Debt & Capital Lease Obligation)	/	Revenue
	=	(271.667	+	9166.777)	/	15940.268
	=	0.59

3. Altman Z-Score.

Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.

The zones of discrimination were as such:

When Z-Score is less than 1.81, it is in Distress Zones.
When Z-Score is greater than 2.99, it is in Safe Zones.
When Z-Score is between 1.81 and 2.99, it is in Grey Zones.

AutoZone has a Z-score of 2.91, indicating it is in Grey Zones. This implies that AutoZone is in some kind of financial stress. If it is below 1.81, the company may faces bankrupcy risk.

Warning Sign:

Altman Z-score of 2.91 is in the grey area. This implies that the company is under some kind of financial stress. If it is below 1.8, the company may face bankruptcy risk.

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

AutoZone (NYSE:AZO) Financial Strength Explanation

The maximum rank is 10. Companies with rank 7 or higher will be unlikely to fall into distressed situations. Companies with rank of 3 or less are likely in financial distress.

AutoZone has the Financial Strength Rank of 5.

AutoZone Financial Strength Related Terms

Thank you for viewing the detailed overview of AutoZone's Financial Strength provided by GuruFocus.com. Please click on the following links to see related term pages.

AutoZone (NYSE:AZO) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Cyclical » Retail - Cyclical » AutoZone Inc (NYSE:AZO) » Definitions » Financial Strength

Comparable Companies

Traded in Other Exchanges

AZO:Mexico AZ5:Germany AZOI34:Brazil AZO:Austria

Address

123 South Front Street, Memphis, TN, USA, 38103

Website

https://www.autozone.com

AutoZone is the premier seller of aftermarket automotive parts, tools, and accessories to do-it-yourself customers in the United States. The company derives an increasing proportion of its sales from domestic commercial customers, although its presence in its home market is still dominated by its do-it-yourself operation, which accounts for around 70% of sales in country. AutoZone also has a growing presence in Mexico and Brazil. AutoZone had 6,943 stores in the U.S. (6,168), Mexico (703), and Brazil (72) as of the end of fiscal 2022.

Executives

Brian Hannasch	director	123 FRONT STREET, MEMPHIS TN 38103
Michael A George	director
John Scott Murphy	officer: Vice President, Controller	123 FRONT STREET, MEMPHIS TN 38103
Dennis W. Leriche	officer: Sr. Vice President	123 FRONT STREET, MEMPHIS TN 38103
Grant E. Mcgee	officer: Sr. Vice President	123 FRONT STREET, MEMPHIS TN 38103
K. Michelle Borninkhof	officer: Senior Vice President & CIO	123 FRONT STREET, MEMPHIS TN 38103
Eric S. Gould	officer: Sr. Vice President	123 SOUTH FRONT STREET, MEMPHIS TN 38103
Seong K. Ohm	officer: Sr. Vice President	123 SOUTH FRONT STREET, MEMPHIS TN 38103
Jamere Jackson	officer: Executive V.P. & CFO Elect	C/O NIELSEN 85 BROAD ST., NEW YORK NY 10004
Preston Frazer	officer: Sr. Vice President	123 SOUTH FRONT ST, MEMPHIS TN 38103
Michael M Calbert	director	C/O DOLLAR GENERAL CORPORATION, 100 MISSION RIDGE, GOODLETTSVILLE TN 37072
Mitchell C. Major	officer: Sr. Vice President	123 SOUTH FRONT STREET, MEMPHIS TN 38103
Domingo Hurtado	officer: Sr. Vice President	123 SOUTH FRONT STREET, MEMPHIS TN 38103
Gale V. King	director	123 SOUTH FRONT STREET, MEMPHIS TN 38103
Jill A. Soltau	director	123 SOUTH FRONT STREET, MEMPHIS TN 38103