AZO · NYSE · Retail-Auto & Home Supply Stores
$3,150.35 · $54.3B market value · fiscal year to 30 Aug 2025
Live from the latest filings
5 of 9
Buffett tests pass
Margin of safety -40%
Bear
$1,088.12
Base
$2,244.14
Bull
$3,872.76
Price $3,150.35
5 pass · 3 mixed · 1 fail · 1 can't tell
At $3,150.35, the price is above the base-case value of $2,244.14 (the bear case is $1,088.12), so there is no margin of safety (-40%). The standard lens asks for 25%.
Why this testTotal debt of $8.8B would take 3.9 yrs of normalised owner earnings to repay; operating income covers interest 7.4×. Interest cover decided this: 4x to 8x is mixed (payback alone would be a pass, at 4 years or less).
Why this testCapital spending has averaged 1.6× depreciation; estimated maintenance capex was $1.2B last year.
Why this testThe owner-earnings yield is 4.1% against a 10-year Treasury yield of 5.2%.
Why this testEquity isn't reported consistently enough to measure returns on it.
Why this testNo loss years across 15 years of filings, with operating margin varying by 1.2% around its average.
Why this testAfter-tax return on invested capital averaged 69% over 10 years and was 56% in the latest year.
Why this testNormalised owner earnings are $2.2B, and free cash flow has averaged 99% of reported profit.
Why this testEach dollar retained over the period has been matched by 1.7× of market value created ($18.3B retained in total).
Why this testThe diluted share count has changed by -6.1% a year. Shrinking means buybacks are returning value; growing means owners are being diluted.
Why this testDiscounted owner earnings
Bear
$1,088.12
Base
$2,244.14
Bull
$3,872.76
Price $3,150.35
| Scenario | Starting owner earnings | Growth (yrs 1–5) | Terminal | Discount | Value / share |
|---|---|---|---|---|---|
| bear | $2.2B | 1.0% | 1.5% | 9.7% | $1,088.12 |
| base | $2.2B | 5.0% | 2.5% | 8.2% | $2,244.14 |
| bull | $2.2B | 8.0% | 3.0% | 7.2% | $3,872.76 |
How sensitive is that?
| Discount ↓ / Growth → | 1.0% | 3.0% | 5.0% | 7.0% | 9.0% |
|---|---|---|---|---|---|
| 6.2% | $2,850 | $3,287 | $3,777 | $4,325 |
Fiscal year to 30 Aug 2025
Replicly is a research and education tool. It is not financial advice and does not recommend that you buy or sell any investment. Analyses apply Buffett-inspired principles to public data and can be wrong. Warren Buffett and Berkshire Hathaway are not affiliated with and do not endorse Replicly. Capital is at risk.
| $4,936 |
| 7.1% | $2,137 | $2,472 | $2,845 | $3,262 | $3,726 |
|---|
| 8.2% | $1,677 | $1,945 | $2,243 | $2,577 | $2,947 |
|---|
| 9.2% | $1,354 | $1,576 | $1,823 | $2,098 | $2,403 |
|---|
| 10.2% | $1,116 | $1,304 | $1,513 | $1,745 | $2,003 |
|---|
Green: at least 25% above the price. Amber: above it. Red: below it. n/a means the discount rate is at or below growth, where the model has no finite answer. The corners combine the most extreme assumptions, so treat them as bounds.
Discount rate: 10-year Treasury (5.2%) plus a 3% equity hurdle. Price $3,150.35 on 20 Oct 2026. End-of-day prices from free public sources, may be delayed or missing.
Revenue
$18.9B
Revenue growth (CAGR)
6.6%
Operating margin (avg)
19%
Return on equity (avg)
n/a
ROIC (avg)
69%
Normalised owner earnings
$2.2B
Cash conversion
99%
Net debt
$8.5B
Debt payback
3.9 yrs
Share count change (CAGR)
-6.1%
Price / earnings
22×
Owner earnings yield
4.1%