One Stock That Made Four Million Dollars

Because the stock market is dominated by disruptive, tech-focused companies, consumers may think the key to investing success is solely investing in them. That's false. One humdrum retail stock has smashed the S&P 500 since its 1991 IPO. From share trading till today, the company has returned 40,520%. almost 34 years, a $10,000 investment would have grown to almost $4 million.

After learning about this company's strengths, you may wish to buy shares in 2024.

This great business should be known to investors. You should know AutoZone (NYSE: AZO). This corporation has 7,191 aftermarket car parts stores, 6,332 in the U.S. Consider what your automobile needs to perform efficiently, especially after the manufacturer's warranty ends.

Despite its $52 billion market worth, this company is overlooked since it doesn't compete in high-growth categories like streaming entertainment or digital advertising. It has nothing to do with AI.

AutoZone is a great company. Strong fundamentals have driven its stock performance. Revenue growth has been continuous for the organization. AutoZone sales rose 6.8% annually from 2013 and fiscal 2023, which ended August 2018. Despite the pandemic, commerce grew.

Opening new stores and improving same-store sales boost sales. That's the best retail blueprint. In its last five fiscal years, AutoZone averaged 7.2% domestic same-store sales growth. We should step back and figure out why the firm has been so successful for so long. Unique long-term track record. This contributes to AutoZone's healthy demand. Everyone needs working cars, even in a recession.

I expect the company to grow steadily. The average car age keeps rising. Every year, Americans drive more miles, which wears out their cars. AutoZone shares have a 21.1 price-to-earnings ratio. This is slightly higher than their 10-year average of 18. Not excessive, though.

Investors get what for that valuation? AutoZone is incredibly lucrative, despite its enduring growth trends. Over the past decade, its operating margin has averaged 19%. As the top line grows, so do operating earnings.

Last fiscal year, this company generated $2.1 billion (12% of revenue) in free cash flow. This shows that the business concept is profitable, indicating a good corporation. It also means AutoZone won't need to raise money to grow. Management repurchases shares with the cash, increasing earnings per share. Over the past eight quarters, outstanding shares have dropped 16%. We hope you've grown to like AutoZone. Every investor should watch this stock, even though its future returns may not be like its past.