Price to FCFE (P/FCFE)
Free Cash Flow to Equity (FCFE)
AutoZone Inc., FCFE calculation
US$ in thousands
Based on: 10-K (reporting date: 2023-08-26), 10-K (reporting date: 2022-08-27), 10-K (reporting date: 2021-08-28), 10-K (reporting date: 2020-08-29), 10-K (reporting date: 2019-08-31), 10-K (reporting date: 2018-08-25).
An analysis of cash flow metrics from August 2018 to August 2023 reveals a divergence between the cash generated from core operations and the cash available to equity holders.
- Net Cash Provided by Operating Activities
- Operational cash flow exhibited a growth phase between 2018 and 2021, rising from 2,080,292 thousand US dollars to a peak of 3,518,543 thousand US dollars. However, a downward trend emerged in the final two years of the period, with values declining to 3,211,135 thousand US dollars in 2022 and further to 2,940,788 thousand US dollars in 2023. This represents a contraction of approximately 16.3% from the 2021 peak.
- Free Cash Flow to Equity (FCFE)
- FCFE demonstrated consistent and uninterrupted growth throughout the entire analyzed timeframe. Starting at 1,429,700 thousand US dollars in 2018, the metric increased annually, reaching 3,619,276 thousand US dollars by August 2023. Over the six-year period, FCFE grew by approximately 153%, indicating a substantial increase in the cash available for distribution to shareholders or debt reduction.
- Comparative Analysis and Insights
- A significant divergence is observable starting in 2022. While net cash provided by operating activities entered a decline, FCFE continued to accelerate, increasing from 2,586,923 thousand US dollars in 2021 to 3,619,276 thousand US dollars in 2023. This inverse relationship suggests that the increase in cash available to equity holders was not driven by operational performance, but rather by other financial levers, such as a reduction in capital expenditures or a strategic increase in net borrowing.
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Price to FCFE Ratio, Current
AutoZone Inc., current P/FCFE calculation, comparison to benchmarks
| No. shares of common stock outstanding | 17,683,418 |
| Selected Financial Data (US$) | |
| Free cash flow to equity (FCFE) (in thousands) | 3,619,276) |
| FCFE per share | 204.67 |
| Current share price (P) | 2,637.36 |
| Valuation Ratio | |
| P/FCFE | 12.89 |
| Benchmarks | |
| P/FCFE, Competitors1 | |
| Amazon.com Inc. | 132.83 |
| Home Depot Inc. | 25.09 |
| Lowe’s Cos. Inc. | 10.59 |
| TJX Cos. Inc. | 31.00 |
| P/FCFE, Sector | |
| Consumer Discretionary Distribution & Retail | 62.82 |
| P/FCFE, Industry | |
| Consumer Discretionary | 45.20 |
Based on: 10-K (reporting date: 2023-08-26).
1 Click competitor name to see calculations.
If the company P/FCFE is lower then the P/FCFE of benchmark then company is relatively undervalued.
Otherwise, if the company P/FCFE is higher then the P/FCFE of benchmark then company is relatively overvalued.
Price to FCFE Ratio, Historical
AutoZone Inc., historical P/FCFE calculation, comparison to benchmarks
| Aug 26, 2023 | Aug 27, 2022 | Aug 28, 2021 | Aug 29, 2020 | Aug 31, 2019 | Aug 25, 2018 | ||
|---|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 17,683,418 | 18,981,426 | 20,967,962 | 23,175,554 | 23,827,496 | 25,559,353 | |
| Selected Financial Data (US$) | |||||||
| Free cash flow to equity (FCFE) (in thousands)2 | 3,619,276) | 3,324,962) | 2,586,923) | 2,530,214) | 1,783,856) | 1,429,700) | |
| FCFE per share3 | 204.67 | 175.17 | 123.38 | 109.18 | 74.87 | 55.94 | |
| Share price1, 4 | 2,416.54 | 2,407.52 | 1,821.09 | 1,152.00 | 1,149.77 | 728.22 | |
| Valuation Ratio | |||||||
| P/FCFE5 | 11.81 | 13.74 | 14.76 | 10.55 | 15.36 | 13.02 | |
| Benchmarks | |||||||
| P/FCFE, Competitors6 | |||||||
| Amazon.com Inc. | 84.16 | 240.95 | — | — | — | — | |
| Home Depot Inc. | 19.60 | 19.87 | 15.41 | — | — | — | |
| Lowe’s Cos. Inc. | 7.08 | 13.55 | 12.28 | — | — | — | |
| TJX Cos. Inc. | 33.59 | — | 10.55 | — | — | — | |
| P/FCFE, Sector | |||||||
| Consumer Discretionary Distribution & Retail | 41.58 | 51.89 | 59.10 | — | — | — | |
| P/FCFE, Industry | |||||||
| Consumer Discretionary | 30.88 | 36.45 | 83.41 | — | — | — | |
Based on: 10-K (reporting date: 2023-08-26), 10-K (reporting date: 2022-08-27), 10-K (reporting date: 2021-08-28), 10-K (reporting date: 2020-08-29), 10-K (reporting date: 2019-08-31), 10-K (reporting date: 2018-08-25).
1 Data adjusted for splits and stock dividends.
3 2023 Calculation
FCFE per share = FCFE ÷ No. shares of common stock outstanding
= 3,619,276,000 ÷ 17,683,418 = 204.67
4 Closing price as at the filing date of AutoZone Inc. Annual Report.
5 2023 Calculation
P/FCFE = Share price ÷ FCFE per share
= 2,416.54 ÷ 204.67 = 11.81
6 Click competitor name to see calculations.
The analysis of equity valuation metrics from 2018 to 2023 reveals a period of substantial capital appreciation supported by a consistent increase in cash flow generation.
- Share Price Trajectory
- A strong upward trend is observed in the share price, which rose from 728.22 US$ in 2018 to 2,416.54 US$ in 2023. The most significant acceleration in price occurred between August 2020 and August 2022, during which the price more than doubled.
- Free Cash Flow to Equity (FCFE) Growth
- FCFE per share exhibited steady and uninterrupted growth throughout the analyzed period. The value increased from 55.94 US$ in 2018 to 204.67 US$ in 2023. This consistent growth indicates an improving capacity to generate cash available to equity holders, which has largely kept pace with the increase in market valuation.
- P/FCFE Ratio Volatility and Valuation
- The P/FCFE ratio fluctuated between a high of 15.36 in 2019 and a low of 10.55 in 2020. Despite the aggressive rise in share price, the ratio remained relatively contained, suggesting that the market valuation was fundamentally supported by the growth in cash flows. A downward trend in the multiple is observed in the final two years, with the ratio decreasing from 13.74 in 2022 to 11.81 in 2023, indicating a contraction in the multiple relative to the cash flow growth.
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