AutoZone Stock Races to Record Highs

AZO stock soared past its consensus 12-month price target

Digital Content Manager
Dec 4, 2018 at 11:12 AM
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Shares of AutoZone, Inc. (NYSE:AZO) stock are up 7.2% to trade at $884.04, and just touched a record high of $894.37, as traders applaud the firm's earnings. The company reported stronger-than-expected fiscal first-quarter earnings, and same-store sales also beat estimates. As such, AZO is pacing for its best day since March 2009.

Since its April 20 low of $591.92, AZO has advanced roughly 50%, with the 120-day moving average containing an October pullback. The equity has gained nearly 24% year-to-date, and rallied 10.3% in November, taking out former resistance in the $800 region.

Despite AutoZone's fundamental and technical strength, several analysts remain skeptical. Seven of 16 maintain tepid "hold ratings, leaving the door open for potential upgrades. Plus, AZO has surpassed its average 12-month price target of $839.82, suggesting price-target hikes could be in store.

What's more, AZO's Schaeffer's put/call open interest ratio (SOIR) of 0.95 sits in the 80th percentile of its annual range. This indicates that while call open interest still outnumbers put open interest on an absolute basis, looking at options expiring in the next three months, short-term traders are more put-heavy than usual right now.

Echoing that, about 1,800 calls and 2,300 puts have changed hands today, at last check. That's five and eight times the average intraday volume, respectively. It appears new bullish positions are being opened at the January 2019 910-strike calls, while some short-term AZO bears are circling the weekly 12/7 850-strike put.


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