AZO (Autozone Inc) vs S&P 500 Comparison

AZO

S&P 500

Compare the stock's returns with its benchmark index and competitors. Gain insights into its relative performance over time.

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AZO

S&P 500

Difference

1Y 3Y 5Y 10Y 15Y 20Y

AZO

S&P 500

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Compare the stock's returns with its benchmark index and competitors. Gain insights into its relative performance over time.

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S&P 500

AZO

ORLY

CVNA

KMX

2207

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1Y 3Y 5Y 10Y 15Y 20Y

Compare the stock's returns with its benchmark index and competitors. Gain insights into its relative performance over time.

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Autozone Inc
Glance View

Economic Moat

Narrow

Market Cap

55.9B USD

Industry

Retail

AutoZone Inc. stands as a towering giant in the realm of the auto parts retail industry, with a network sprawling across the United States, Mexico, and Brazil. Founded in 1979 as a small retail chain by entrepreneur J.R. “Pitt” Hyde III, it has grown into a formidable presence, driven by its commitment to providing high-quality automotive replacement parts and accessories. The company operates through a chain of stores and a robust online platform, offering a diverse array of products catering to the needs of both do-it-yourself (DIY) enthusiasts and professional service providers. With its streamlined distribution system, AutoZone efficiently manages its extensive inventory, ensuring the availability of critical components for various vehicle makes and models. Central to AutoZone’s business model is its focus on customer satisfaction, which it achieves by leveraging knowledgeable staff, competitive pricing, and strategic store locations. The company earns revenue primarily through sales of aftermarket automotive parts, such as brake pads, alternators, batteries, and spark plugs. Additionally, it provides an array of tools and equipment for automotive repairs and maintenance. By catering to a broad customer base—from individual vehicle owners seeking cost-effective solutions to professional mechanics requiring prompt and reliable parts delivery—AutoZone capitalizes on the enduring demand for vehicle maintenance and repair, securing its position as a leader in the automotive aftermarket industry.

View AZO Analysis

AZO Intrinsic Value

What is Intrinsic Value?

Economic Moat is a concept popularized by Warren Buffett to describe a company's durable competitive advantage. It represents the 'moat' that protects a company from competitors and helps it sustain profitability over the long term. Our analysis of the past 10 years showed that companies with a wide economic moat significantly outperformed the market, delivering +645% returns compared to +189% for the S&P 500.

Our research into Economic Moat performance spans the past 10 years and focuses on companies with a wide economic moat. For this analysis, we calculated the average stock price returns of these companies, comparing them to the performance of the S&P 500 index over the same period.

The results were compelling: wide moat stocks achieved a remarkable +645% average return, compared to +188% for the broader market. This difference highlights the long-term benefits of investing in businesses that can maintain their market position and pricing power over time.

Note: This research does not account for survivorship bias. Past performance is not indicative of future results.

Determining whether a company has an economic moat requires both a deep dive into financial metrics and a qualitative assessment of its competitive position. Our analysts conduct a rigorous evaluation that focuses on identifying structural advantages that enable a company to sustain profitability and defend its market share over the long term.

The process begins with an analysis of a company’s historical financial performance. We assess how consistently the company has generated returns above its cost of capital and whether those returns have been stable or improving. However, financial performance alone doesn’t reveal the full picture. To understand the sources of these advantages, we evaluate five key drivers of economic moats:

Network Effect: We analyze whether the value of a company’s product or service grows as its user base expands. Platforms like payment systems or marketplaces benefit from this self-reinforcing.

Switching Costs: We assess whether customers face significant costs or disruptions when switching to a competitor’s product or service. High switching costs create customer stickiness and provide pricing power.

Intangible Assets: Strong brands, patents, and regulatory licenses can protect a company’s market position by creating barriers for competitors or enabling premium pricing. For example, a well-recognized consumer brand may command higher customer loyalty and margins.

Efficient scale: Occurs when a market is optimally served by one or a few players, making it unprofitable for new entrants to compete. This typically happens in industries with high fixed costs or geographic constraints, such as utilities or pipelines.

Cost Advantage: Companies with structural cost advantages can produce goods or services at a lower cost than their competitors, enabling them to offer competitive pricing or maintain higher margins. These advantages often arise from economies of scale, superior supply chain management, or proprietary technology. Firms like Walmart leverage their massive scale to negotiate better terms with suppliers, allowing them to undercut competitors on price.

By examining these factors in combination with a company’s financial performance and market positioning, we classify each company into one of three categories:

This rigorous evaluation ensures that our moat ratings are both comprehensive and reliable, giving investors the tools they need to make well-informed, long-term decisions.

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AZO

vs

S&P 500

Stocks Performance
AZO vs S&P 500

Performance Gap
AZO vs S&P 500

Performance By Year
AZO vs S&P 500

Competitors Performance
Autozone Inc vs Peers

Autozone Inc
Glance View

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AZO vs S&P 500

Stocks Performance AZO vs S&P 500

Performance Gap AZO vs S&P 500

Performance By Year AZO vs S&P 500

Competitors Performance Autozone Inc vs Peers

Autozone Inc Glance View

Company

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Stocks

AZO

vs

S&P 500

Stocks Performance
AZO vs S&P 500

Performance Gap
AZO vs S&P 500

Performance By Year
AZO vs S&P 500

Competitors Performance
Autozone Inc vs Peers

Autozone Inc
Glance View