Why Shares of AutoZone Suddenly Plunged

• Earnings missed expectations owed to tariffs.

• The institution continues to grow successful a steadfast car parts aftermarket.

• 10 stocks we similar amended than AutoZone ›

AutoZone (NYSE: AZO) shares plunged connected Tuesday, making it the worst-performing banal successful the S&P 500 scale astatine midday.

What's going on?

Well, the automotive replacement parts and accessories concatenation reported its first-quarter fiscal results connected Tuesday greeting and Wall Street was not impressed.

While gross successful the 4th roseate 8.2% from a twelvemonth ago, to $4.6 billion, diluted net per stock came successful astatine $31.04, beneath past year's level and, much importantly, little than the statement expert estimation of $32.71.

In addition, analysts expected same-store income -- a cardinal metric for immoderate retailer -- to emergence 5.6% implicit past year, but maturation was little astatine 5.5%.

The institution blamed its falling net connected tariffs.

That said, the car parts retailer opened 53 nett caller stores successful the 4th -- including 12 successful Mexico and 2 successful Brazil -- and said it plans to aggressively unfastened much done the remainder of the fiscal year. It presently has a full of 7,710 stores, each of them successful the U.S., Mexico, and Brazil.

And the institution is good positioned to payment from a increasing automotive aftermarket, which is expected to scope $576 cardinal this twelvemonth successful the U.S. and $2.3 cardinal globally. So investors mightiness person overreacted connected Tuesday.

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Matthew Benjamin has nary presumption successful immoderate of the stocks mentioned. The Motley Fool has nary presumption successful immoderate of the stocks mentioned. The Motley Fool has a disclosure policy.

Why Shares of AutoZone Suddenly Plunged was primitively published by The Motley Fool