We recently published a list of 15 Highest-Priced Stocks Right Now. In this article, we are going to take a look at where AutoZone, Inc. (NYSE:AZO) stands against other highest-priced stocks right now.
2024 was a blockbuster year for the US markets, with the broad market index up 23.31% during the year, after rising 24.2% in the year prior. The two-year gain of 53% is the best performance for the index since the 66% rally between 1997 and 1998.
READ ALSO: 10 Best Single Digit Stocks To Buy Now and 12 Best S&P 500 Stocks to Invest in According to Analysts.
The market benefited from declining interest rates, waning inflation, and a resilient economy that avoided recession. While analysts have projected continued growth in 2025, they are also cautious about the rally having gone too far with a correction in the offing this year. Fears of fierce trade wars and geopolitical conflicts could also hurt the stock market.
Over the past few weeks, President Trump has announced and then delayed tariffs on Canada and Mexico, imposed additional 10% tariffs on Chinese goods, and warned the European Union of similar treatment, citing the bloc’s treatment of the U.S. The new administration’s protectionist policies have sparked concerns in the markets about which countries will be next on the American president’s list, leaving several large multinationals unsure of how to plan.
According to analysts at Goldman Sachs Research, index earnings could drop by 2-3% if the US goes ahead with its proposed tariffs. Financial markets have been turbulent amid ongoing tariff negotiations between Washington and its major trade partners. Here is what chief equity strategist, David Kostin, wrote in a recent report.
“If company managements decide to absorb the higher input costs, then profit margins would be squeezed. If companies pass along the higher costs to end customers, then sales volumes may suffer. Firms may try to push back on their suppliers and ask them to absorb part of the cost of the tariff through lower prices.”
Analysts at the investment banking firm have also warned that protectionist policies driving up the value of the U.S. Dollar could further pressure the earnings of several companies, especially those that derive a significant portion of their revenues outside the United States.
Time will tell whether the Trump administration implements the tariffs or reaches a compromise with its trade partners, and how the markets react if the export taxes are imposed. However, if past trends are anything to go by, the broad market index dropped by a total of 5% on days when the U.S., under Trump’s first stint as president, announced tariffs in 2018 and 2019. The index fell by a cumulative 7% when other countries imposed retaliatory tariffs.
Methodology
We went through screeners to identify the highest-priced stocks as of the close of the day on Friday, February 14, 2025 and ranked them in ascending order of their share price.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
A technician in a mechanic’s uniform replacing an A/C compressor, signifying the company’s automotive replacement parts business.
AutoZone, Inc. (NYSE:AZO)
Share Price on February 14: $3,458.55
AutoZone, Inc. (NYSE:AZO) is a retailer and distributor of automotive replacement parts and accessories. The company has over 7,000 stores across the United States, Brazil, and Mexico. It is one of the highest-priced stocks right now, with its share price rising by nearly 27% over the past 12 months.
While the company primarily serves the do-it-yourself (DIY) market, it also caters to professional auto repair shops. Established in 1979, AutoZone, Inc. (NYSE:AZO) has consistently expanded over the years and continues to add several new stores each year, even during challenging market conditions.
During the first quarter of fiscal 2025, AutoZone, Inc. (NYSE:AZO) opened 23 new stores in the United States. It also continued with international expansion and has grown its footprint in Mexico by 7.4% compared to the first quarter of fiscal 2024, while its store count increased by 26.9% in Brazil during the period.
AutoZone, Inc. (NYSE:AZO) generated net sales of $4.3 billion in Q1 FY25, up 2.1% year-over-year. Overall same-store sales increased 1.8%, while domestic same-store sales grew 0.3% during the quarter. Gross profit was 53%, improving 16 basis points from last year, driven by higher merchandise margins. Net income stood at $564.9 million, down from $593.5 million in the prior year’s quarter. Diluted EPS was $32.52 compared to last year at $32.55 per share.
Considering its rapid expansion and competitive advantages of scale and extensive distribution networks, AutoZone, Inc. (NYSE:AZO) is poised for future growth, despite the potential threats from e-commerce. Wall Street analysts are bullish on the stock with a consensus Strong Buy rating.
Investor sentiment continues to improve as well. According to Insider Monkey’s database for Q3 2024, 47 hedge funds held a stake in AutoZone, Inc. (NYSE:AZO), up from 45 at the end of the second quarter.
Overall, AZO ranks 4th on our list of highest-priced stocks right now. While we acknowledge the potential of conglomerate holding companies, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than AZO but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
