Leading position in the retail auto parts aftermarket, an industry which should continue to benefit over the near-to-medium term from weak new vehicle sales; Generates healthy free operating cash flow; and Good operating margins compared with industry peers. Operates in the highly competitive retail auto parts aftermarket industry; Aggressive financial policy, particularly with respect to share repurchases; Despite positive near- to medium-term industry dynamics, historically weak Do-It-Yourself (DIY) growth could re-emerge under better economic conditions; and Declining traffic volume trends and sensitivity to fuel price changes. The ratings on AutoZone Inc. reflect the company's leading position in the generally stable but highly competitive retail automotive parts aftermarket (the outlook for which has improved), consistent operating performance, and strong profitability measures.
