Stock Analysis on Net
Stock Analysis on Net

AutoZone Inc. (NYSE:AZO)

$22.49

This company has been moved to the archive! The financial data has not been updated since December 18, 2023.

Economic Value Added (EVA)

Microsoft Excel

EVA is registered trademark of Stern Stewart.

Economic value added or economic profit is the difference between revenues and costs,where costs include not only expenses, but also cost of capital.

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Economic Profit

AutoZone Inc., economic profit calculation

US$ in thousands

Microsoft Excel
12 months ended: Aug 26, 2023 Aug 27, 2022 Aug 28, 2021 Aug 29, 2020 Aug 31, 2019 Aug 25, 2018
Net operating profit after taxes (NOPAT)1
Cost of capital2
Invested capital3
 
Economic profit4

Based on: 10-K (reporting date: 2023-08-26), 10-K (reporting date: 2022-08-27), 10-K (reporting date: 2021-08-28), 10-K (reporting date: 2020-08-29), 10-K (reporting date: 2019-08-31), 10-K (reporting date: 2018-08-25).

1 NOPAT. See details »

2 Cost of capital. See details »

3 Invested capital. See details »

4 2023 Calculation
Economic profit = NOPAT – Cost of capital × Invested capital
= – × =

Item Description The company
Economic profit Economic profit is a measure of corporate performance computed by taking the spread between the return on invested capital and the cost of capital, and multiplying by the invested capital. AutoZone Inc. economic profit increased from 2021 to 2022 but then slightly decreased from 2022 to 2023 not reaching 2021 level.

Net Operating Profit after Taxes (NOPAT)

AutoZone Inc., NOPAT calculation

US$ in thousands

Microsoft Excel
12 months ended: Aug 26, 2023 Aug 27, 2022 Aug 28, 2021 Aug 29, 2020 Aug 31, 2019 Aug 25, 2018
Net income
Deferred income tax expense (benefit)1
Increase (decrease) in allowance for credit losses2
Increase (decrease) in LIFO reserve3
Increase (decrease) in accrued sales and warranty returns4
Increase (decrease) in equity equivalents5
Interest expense, less capitalized interest
Interest expense, operating lease liability6
Adjusted interest expense, less capitalized interest
Tax benefit of interest expense, less capitalized interest7
Adjusted interest expense, less capitalized interest, after taxes8
(Gain) loss on marketable securities
Interest income
Investment income, before taxes
Tax expense (benefit) of investment income9
Investment income, after taxes10
Net operating profit after taxes (NOPAT)

Based on: 10-K (reporting date: 2023-08-26), 10-K (reporting date: 2022-08-27), 10-K (reporting date: 2021-08-28), 10-K (reporting date: 2020-08-29), 10-K (reporting date: 2019-08-31), 10-K (reporting date: 2018-08-25).

1 Elimination of deferred tax expense. See details »

2 Addition of increase (decrease) in allowance for credit losses.

3 Addition of increase (decrease) in LIFO reserve. See details »

4 Addition of increase (decrease) in accrued sales and warranty returns.

5 Addition of increase (decrease) in equity equivalents to net income.

6 2023 Calculation
Interest expense on capitalized operating leases = Operating lease liability × Discount rate
= × =

7 2023 Calculation
Tax benefit of interest expense, less capitalized interest = Adjusted interest expense, less capitalized interest × Statutory income tax rate
= × 21.00% =

8 Addition of after taxes interest expense to net income.

9 2023 Calculation
Tax expense (benefit) of investment income = Investment income, before tax × Statutory income tax rate
= × 21.00% =

10 Elimination of after taxes investment income.

Item Description The company
NOPAT Net operating profit after taxes is income from operations, but after removement of taxes calculated on cash basis that are relevant to operating income. AutoZone Inc. NOPAT increased from 2021 to 2022 but then slightly decreased from 2022 to 2023.

Cash Operating Taxes

AutoZone Inc., cash operating taxes calculation

US$ in thousands

Microsoft Excel
12 months ended: Aug 26, 2023 Aug 27, 2022 Aug 28, 2021 Aug 29, 2020 Aug 31, 2019 Aug 25, 2018
Income tax expense
Less: Deferred income tax expense (benefit)
Add: Tax savings from interest expense, less capitalized interest
Less: Tax imposed on investment income
Cash operating taxes

Based on: 10-K (reporting date: 2023-08-26), 10-K (reporting date: 2022-08-27), 10-K (reporting date: 2021-08-28), 10-K (reporting date: 2020-08-29), 10-K (reporting date: 2019-08-31), 10-K (reporting date: 2018-08-25).

Item Description The company
Cash operating taxes Cash operating taxes are estimated by adjusting income tax expense for changes in deferred taxes and tax benefit from the interest deduction. AutoZone Inc. cash operating taxes decreased from 2021 to 2022 but then increased from 2022 to 2023 exceeding 2021 level.

Invested Capital

AutoZone Inc., invested capital calculation (financing approach)

US$ in thousands

Microsoft Excel
Aug 26, 2023 Aug 27, 2022 Aug 28, 2021 Aug 29, 2020 Aug 31, 2019 Aug 25, 2018
Current portion of finance lease liabilities
Long-term debt
Finance lease liabilities, less current portion
Operating lease liability1
Total reported debt & leases
Stockholders’ deficit
Net deferred tax (assets) liabilities2
Allowance for credit losses3
LIFO reserve4
Accrued sales and warranty returns5
Equity equivalents6
Accumulated other comprehensive (income) loss, net of tax7
Adjusted stockholders’ deficit
Construction in progress8
Marketable debt securities9
Invested capital

Based on: 10-K (reporting date: 2023-08-26), 10-K (reporting date: 2022-08-27), 10-K (reporting date: 2021-08-28), 10-K (reporting date: 2020-08-29), 10-K (reporting date: 2019-08-31), 10-K (reporting date: 2018-08-25).

1 Addition of capitalized operating leases.

2 Elimination of deferred taxes from assets and liabilities. See details »

3 Addition of allowance for doubtful accounts receivable.

4 Addition of LIFO reserve. See details »

5 Addition of accrued sales and warranty returns.

6 Addition of equity equivalents to stockholders’ deficit.

7 Removal of accumulated other comprehensive income.

8 Subtraction of construction in progress.

9 Subtraction of marketable debt securities.

Item Description The company
Invested capital Capital is an approximation of the economic book value of all cash invested in going-concern business activities. AutoZone Inc. invested capital decreased from 2021 to 2022 but then increased from 2022 to 2023 exceeding 2021 level.

Cost of Capital

AutoZone Inc., cost of capital calculations

Capital (fair value)1 Weights Cost of capital
Equity2 ÷ = × =
Long-term debt and finance lease liabilities3 ÷ = × × (1 – 21.00%) =
Operating lease liability4 ÷ = × × (1 – 21.00%) =
Total:

Based on: 10-K (reporting date: 2023-08-26).

1 US$ in thousands

2 Equity. See details »

3 Long-term debt and finance lease liabilities. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 ÷ = × =
Long-term debt and finance lease liabilities3 ÷ = × × (1 – 21.00%) =
Operating lease liability4 ÷ = × × (1 – 21.00%) =
Total:

Based on: 10-K (reporting date: 2022-08-27).

1 US$ in thousands

2 Equity. See details »

3 Long-term debt and finance lease liabilities. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 ÷ = × =
Long-term debt and finance lease liabilities3 ÷ = × × (1 – 21.00%) =
Operating lease liability4 ÷ = × × (1 – 21.00%) =
Total:

Based on: 10-K (reporting date: 2021-08-28).

1 US$ in thousands

2 Equity. See details »

3 Long-term debt and finance lease liabilities. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 ÷ = × =
Long-term debt and finance lease liabilities3 ÷ = × × (1 – 21.00%) =
Operating lease liability4 ÷ = × × (1 – 21.00%) =
Total:

Based on: 10-K (reporting date: 2020-08-29).

1 US$ in thousands

2 Equity. See details »

3 Long-term debt and finance lease liabilities. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 ÷ = × =
Long-term debt and finance lease liabilities3 ÷ = × × (1 – 21.00%) =
Operating lease liability4 ÷ = × × (1 – 21.00%) =
Total:

Based on: 10-K (reporting date: 2019-08-31).

1 US$ in thousands

2 Equity. See details »

3 Long-term debt and finance lease liabilities. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 ÷ = × =
Long-term debt and finance lease liabilities3 ÷ = × × (1 – 25.90%) =
Operating lease liability4 ÷ = × × (1 – 25.90%) =
Total:

Based on: 10-K (reporting date: 2018-08-25).

1 US$ in thousands

2 Equity. See details »

3 Long-term debt and finance lease liabilities. See details »

4 Operating lease liability. See details »

Economic Spread Ratio

AutoZone Inc., economic spread ratio calculation, comparison to benchmarks

Microsoft Excel
Aug 26, 2023 Aug 27, 2022 Aug 28, 2021 Aug 29, 2020 Aug 31, 2019 Aug 25, 2018
Selected Financial Data (US$ in thousands)
Economic profit1
Invested capital2
Performance Ratio
Economic spread ratio3
Benchmarks
Economic Spread Ratio, Competitors4
Amazon.com Inc.
Home Depot Inc.
Lowe’s Cos. Inc.
TJX Cos. Inc.

Based on: 10-K (reporting date: 2023-08-26), 10-K (reporting date: 2022-08-27), 10-K (reporting date: 2021-08-28), 10-K (reporting date: 2020-08-29), 10-K (reporting date: 2019-08-31), 10-K (reporting date: 2018-08-25).

1 Economic profit. See details »

2 Invested capital. See details »

3 2023 Calculation
Economic spread ratio = 100 × Economic profit ÷ Invested capital
= 100 × ÷ =

4 Click competitor name to see calculations.

Performance ratio Description The company
Economic spread ratio The ratio of economic profit to invested capital, also equal to the difference between return on invested capital (ROIC) and cost of capital. AutoZone Inc. economic spread ratio improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023 not reaching 2021 level.

Economic Profit Margin

AutoZone Inc., economic profit margin calculation, comparison to benchmarks

Microsoft Excel
Aug 26, 2023 Aug 27, 2022 Aug 28, 2021 Aug 29, 2020 Aug 31, 2019 Aug 25, 2018
Selected Financial Data (US$ in thousands)
Economic profit1
Net sales
Performance Ratio
Economic profit margin2
Benchmarks
Economic Profit Margin, Competitors3
Amazon.com Inc.
Home Depot Inc.
Lowe’s Cos. Inc.
TJX Cos. Inc.

Based on: 10-K (reporting date: 2023-08-26), 10-K (reporting date: 2022-08-27), 10-K (reporting date: 2021-08-28), 10-K (reporting date: 2020-08-29), 10-K (reporting date: 2019-08-31), 10-K (reporting date: 2018-08-25).

1 Economic profit. See details »

2 2023 Calculation
Economic profit margin = 100 × Economic profit ÷ Net sales
= 100 × ÷ =

3 Click competitor name to see calculations.

Performance ratio Description The company
Economic profit margin The ratio of economic profit to sales. It is the company profit margin covering income efficiency and asset management. Economic profit margin is not biased in favor of capital-intensive business models, because any added capital is a cost to the economic profit margin. AutoZone Inc. economic profit margin improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023 not reaching 2021 level.