Leading position in the retail auto parts aftermarket; Generates healthy free operating cash flow; and Good operating margins compared with industry peers. Operates in the highly competitive auto parts industry; Flat-to-slightly negative same-store sales in recent years; History of aggressive share repurchases. The ratings on Memphis, Tenn.-based AutoZone Inc. reflect the company's leading position in the stable but highly competitive retail automobile parts aftermarket, consistent operating performance, and strong profitability measures. These strengths are somewhat tempered by management's historically aggressive share repurchase activity and flat-to-slightly negative same-store sales growth over the past four years. AutoZone is the largest retailer of automotive parts in the U.S., with about 3,900 stores in 48 states and more than 120 in Mexico. Consolidation in
