Head-To-Head Survey: American Eagle Outfitters (NYSE:AEO) vs. AutoZone (NYSE:AZO)

AutoZone (NYSE:AZO) and American Eagle Outfitters (NYSE:AEO) are both consumer discretionary companies, but which is the superior business? We will contrast the two businesses based on the strength of their valuation, profitability, analyst recommendations, institutional ownership, earnings, dividends and risk.

Analyst Recommendations

This is a breakdown of current recommendations for AutoZone and American Eagle Outfitters, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
AutoZone	0	6	20	1	2.81
American Eagle Outfitters	1	10	2	1	2.21

AutoZone presently has a consensus price target of $3,717.12, suggesting a potential upside of 30.51%. American Eagle Outfitters has a consensus price target of $19.36, suggesting a potential upside of 21.59%. Given AutoZone’s stronger consensus rating and higher probable upside, equities research analysts plainly believe AutoZone is more favorable than American Eagle Outfitters.

Earnings & Valuation

This table compares AutoZone and American Eagle Outfitters”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
AutoZone	$19.99 billion	2.33	$2.50 billion	$152.79	18.64
American Eagle Outfitters	$5.75 billion	0.46	$191.98 million	$1.96	8.13

AutoZone has higher revenue and earnings than American Eagle Outfitters. American Eagle Outfitters is trading at a lower price-to-earnings ratio than AutoZone, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares AutoZone and American Eagle Outfitters’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
AutoZone	12.65%	-90.08%	12.45%
American Eagle Outfitters	5.91%	23.63%	9.59%

Risk and Volatility

AutoZone has a beta of 0.34, indicating that its share price is 66% less volatile than the S&P 500. Comparatively, American Eagle Outfitters has a beta of 1.33, indicating that its share price is 33% more volatile than the S&P 500.

Insider & Institutional Ownership

92.7% of AutoZone shares are owned by institutional investors. Comparatively, 97.3% of American Eagle Outfitters shares are owned by institutional investors. 2.6% of AutoZone shares are owned by company insiders. Comparatively, 8.9% of American Eagle Outfitters shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Summary

AutoZone beats American Eagle Outfitters on 10 of the 14 factors compared between the two stocks.

About AutoZone

AutoZone, Inc. retails and distributes automotive replacement parts and accessories in the United States, Mexico, and Brazil. The company provides various products for cars, sport utility vehicles, vans, and light trucks, including new and remanufactured automotive hard parts, maintenance items, accessories, and non-automotive products. It also offers A/C compressors, batteries and accessories, bearings, belts and hoses, calipers, chassis, clutches, CV axles, engines, fuel pumps, fuses, ignition and lighting products, mufflers, radiators, starters and alternators, thermostats, and water pumps, as well as tire repairs. In addition, the company provides maintenance products, such as antifreeze and windshield washer fluids; brake drums, rotors, shoes, and pads; brake and power steering fluids, and oil and fuel additives; oil and transmission fluids; oil, cabin, air, fuel, and transmission filters; oxygen sensors; paints and accessories; refrigerants and accessories; shock absorbers and struts; spark plugs and wires; and windshield wipers. Further, it offers air fresheners, cell phone accessories, drinks and snacks, floor mats and seat covers, interior and exterior accessories, mirrors, performance products, protectants and cleaners, sealants and adhesives, steering wheel covers, tools, vehicle entertainment systems, and wash and wax products, as well as towing services. Additionally, the company provides a sales program that offers commercial credit and delivery of parts and other products; sells automotive diagnostic and repair software under the ALLDATA brand through alldata.com and alldatadiy.com; and automotive hard parts, maintenance items, accessories, and non-automotive products through autozone.com. AutoZone, Inc. was founded in 1979 and is headquartered in Memphis, Tennessee.

About American Eagle Outfitters

American Eagle Outfitters, Inc. operates as a multi-brand specialty retailer in the United States and internationally. The company provides jeans, apparel and accessories, and personal care products for women and men under the American Eagle brand; and intimates, apparel, activewear, and swim collections under the Aerie and OFFLINE by Aerie brands. It also offers menswear products under the Todd Snyder New York brand; and fashion clothing and accessories under the Unsubscribed brand. The company sells its products through own and licensed retail stores; concession-based shops-within-shops; and digital channels, such as www.ae.com, www.aerie.com, www.toddsnyder.com, and www.unsubscribed.com. American Eagle Outfitters, Inc. was founded in 1977 and is headquartered in Pittsburgh, Pennsylvania.