Insider transactions can give investors a more complete view of what’s happening within the world’s publicly-listed companies. No one has more information in relation to a company than its leaders.
In this report, we are going to highlight some interesting insider buying at AutoZone Inc (AZO:US). AutoZone is an American retailer of aftermarket automotive parts and accessories. Founded in 1979, it operates in 50 US states, as well as in Puerto Rico, Mexico, and Brazil. The company is listed on the New York Stock Exchange and currently has a market cap of around $44.86 billion.
Large Insider Purchase
Our data shows that on June 12, AutoZone’s Chief Information Officer Michelle Borninkhof purchased 476 shares at a price of $2,406.65 per share. She bought 217 shares directly and purchased 259 shares through her spouse. This trade cost her around $1.14 million and increased her total holding to 760 shares.
This trade is worth highlighting due to its size. Not only is it large in nominal terms but it is also large in relative terms, having increased the size of Ms. Borninfhof’s holding significantly. Ultimately, it appears to be a high-conviction purchase.
It’s worth noting that Ms. Borninfhof has considerable experience in the retail industry. Earlier in her career, she spent 11 years at Walmart in various leadership roles including Vice President, International Technology Delivery. So, she is likely to have a good read on industry trends.
Additional Buyback Authorized
AutoZone recently posted a solid set of Q3 results, given the level of weakness in this industry recently.
For the quarter ended May 6, net sales came in at $4.1 billion, up 5.8% year on year. Net income amounted to $647.7 million, up 9.3% year on year, while diluted earnings per share increased 17.5% to $34.12.
On the back of these results, the company’s Board of Directors authorized the repurchase of an additional $2.0 billion worth of common stock. This was after the group repurchased around $908 million worth of stock during the last quarter.
“AutoZone’s continued strong financial performance allows us to grow our business, return meaningful amounts of cash to our shareholders and maintain our investment grade credit ratings,” commented CFO Jamere Jackson after the additional buyback was announced
In light of these solid results, and the additional buyback, we see the insider buying here as a bullish development.