AutoZone Gains Market Share, But Analysts Cut Targets On Margin Worries

AutoZone Inc (NYSE:AZO)shares were down on Wednesday morning after the company reported disappointing fiscal first-quarter results.

• AutoZone stock is under selling pressure. What’s driving AZO stock lower?

Here are some key analyst takeaways:

• Guggenheim Securities analyst Steven Forbes reaffirmed a Buy rating, while reducing the price target from $4,600 to $4,400.
• DA Davidson analyst Michael Baker reiterated a Buy rating, while slashing the price target from $4,850 to $4,500.

Check out other analyst stock ratings.

Guggenheim Securities: AutoZone made a "solid start to 2026," with U.S. commercial growth continuing to gain momentum, Forbes said in a note. Net sales rose 8.3% year-over-year, driven by double-digit domestic commercial net sales growth, he added.

Management indicated growth in all merchandise categories in the quarter and raised its guidance for 2026 new store and hub store growth to 350-360, from their previous projection of 335-350, the analyst stated. The guidance suggests a sequential increase in average ticket trends by around 100 basis points, "setting the stage for accelerated 2Q net sales growth," he further wrote.

DA Davidson: AutoZone's commercial sales grew 14.5% in the quarter and remained "relatively stable throughout the four-week periods," Baker said. "We believe the strong commercial growth indicates AZO is taking share in the category," he wrote.

AutoZone reported weaker-than-expected margins and investors grew concerned about increased investments damping operating margins in the near term, the analyst stated. "DIY comps remain pressured relative to commercial, evidenced by failure and maintenance categories remaining the best performing category, with weaker discretionary product performance," he further wrote.

AZO Price Action: Shares of AutoZone is down 1.44% to $3,446.26 at the time of publication on Wednesday.

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