Insider Activity Report: AutoZone (AZO)

Jenna Bedsole, a Senior Vice President at AutoZone (AZO) recently bought 36 shares. The buy is an initial stake for the SVP, and came to a total cost of $99,256.

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  • This is the first insider buy since June, when another company SVP bought 476 shares at a cost of $1.1 million. Otherwise, company insiders have largely been sellers of shares, with nearly all of those sales coming following the exercise of stock options.

    In total, AutoZone insiders own 0.3% of shares.

    The auto parts store chain is up 14% over the past year. While Americans are holding onto their cars for  longer periods of time, which should drive up demand for auto parts, AutoZone has struggled.

    Earnings grew by less than 1% in the past year, and revenues were up just 4%. Shares do trade at a slight discount to the overall stock market at 17 times forward earnings.

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  • Action to take: Shares have recently dropped about 14% from their 52-week highs.

    Plus, it looks like the stock just completed the final selloff from a head and shoulders pattern. That suggests a trend higher in the coming months. Investors may like shares here for a low-double-digit rally in the coming months.

    For traders, the September $3,200 calls, last trading for about $24.00, could see high double-digit returns from a rebound in shares in the months ahead. Traders should look to take quick profits from a jump higher.

     

    Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any company mentioned in this article.

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