AutoZone, Inc. (AZO) released its fourth quarter and full-year earnings report on Tuesday, September 24. The auto parts company’s shares dipped over 2% after the report’s release.

The company reported net sales of $6.21 billion during the quarter, in line with analysts’ expectations. This was up 9% from $5.69 billion in sales during the same quarter last year. Full-year sales returned at $18.49 billion, a 5.9% increase from $17.46 billion in fiscal 2023.

“I want to thank our AutoZoners for their contributions during fiscal 2024 that resulted in our solid performance,” said AutoZone CEO, Phil Daniele. “Domestically, our business continues to be challenged by deferrals across our discretionary merchandise categories, but we were pleased to see accelerating Commercial sales performance. We are also happy to report our international businesses continued to perform well, up roughly 10% on a constant currency basis.”

AutoZone reported net income of $902.21 million for the quarter or $51.18 per adjusted share. This was up from $864.84 million or $46.46 per adjusted share in the same quarter last year. For the full year, the company reported net income of $2.66 billion or $149.55 per diluted share. This was up from net income of $2.53 billion or $132.36 per diluted share in fiscal 2023.

The Memphis, Tennessee-based company saw a 0.2% increase in their domestic same store sales and a 4.9% increase in international same store sales for the quarter. During the quarter, AutoZone opened 117 new stores including 68 new stores in the U.S., 31 in Mexico and 18 in Brazil. At the end of fiscal 2024, the company had a combined total of 7,353 stores globally. The company’s new store growth resulted in the company’s inventory increasing 6.8% over the same period last year. AutoZone returned $710.6 million to shareholders through share repurchases in the fourth quarter of fiscal 2024 and has $2.2 billion remaining under its current share repurchase program.

AutoZone, Inc. (AZO) shares ended the week at $3,196.61, up 5% for the week.

KB Home Reports Third Quarter Results

KB Home (KBH) reported its third quarter earnings on Tuesday, September 24. The homebuilder reported weaker-than-expected revenue and earnings, causing shares to fall by more than 7% following the earnings release.

KB Home reported quarterly revenue of $1.75 billion. This was up over 10% from revenue of $1.59 billion during the same quarter last year but below analysts’ expectations of $1.73 billion in revenue.

“In the third quarter, we achieved strong year-over-year growth in both revenues and diluted earnings per share,” said KB Home CEO, Jeffrey Mezger. “While we navigate current market dynamics, we continue to position our Company to accomplish our longer-term objectives of profitability expanding our scale and driving higher returns. At the same time, we are maintaining a balanced approach in redeploying our cash toward reinvesting in our growth and returning capital to our stockholders.”

For the quarter, KB reported net income of $157.3 million or $2.04 per adjusted share. This was an increase from net income of $149.9 million or $1.80 per adjusted share in the same quarter last year.

KB reported homebuilding operating income totaled $189.0 million for the quarter, up from $179.2 million. The company’s financial services segment revenue decreased 9% to $6.6 million. KB delivered 3,631 homes in the quarter, an increase of 8% from the same time last year. The company reported the average selling price per home was $480,900, a 3% increase from $466,300 the prior year. The number of homes in the company’s ending backlog totaled 5,724, down 18%. KB adjusted its full-year 2024 guidance and expects fiscal year 2024 revenue between $6.85 billion to $6.95 billion, an increase from its previous forecast of $6.70 billion to $6.90 billion.

KB Home (KBH) shares ended the week at $85.94, down 3% for the week.

Stitch Fix Reports Results

Stitch Fix, Inc. (SFIX) released its fourth quarter and full-year earnings report on Tuesday, September 24. The clothing company’s shares declined 17% in after-hours trading following the release of the report.

Net revenue for the quarter came in at $319.6 million, down 12.4% from $364.7 million in net revenue at this time last year. This beat analysts’ expectations of $318.5 million in net revenue. Full-year revenue returned at $1.34 billion, a 16% decrease from $1.59 billion in fiscal 2023.

“We are executing our transformation strategy with discipline and, during the fourth quarter, we delivered results at the high end of our guidance on both the top and bottom line,” said Stitch Fix CEO, Matt Baer. “I am proud of the Stitch Fix team’s efforts this past fiscal year and encouraged by the progress we have already made to strengthen the foundation of our business and reimagine our client experience.”

The company posted a net loss of $36.5 million for the quarter or $0.29 per share. This was down from a net loss of $28.7 million or $0.17 per share during the same quarter last year. For the full year, the company reported a net loss of $128.8 million or $0.99 per diluted share. This was an improvement from a net loss of $172.0 million or $1.31 per diluted share in fiscal 2023.

In comparison to the previous year, Stitch Fix reported a decrease of 4.7% in active clients to 2,508,000. Net revenue per active client increased 4.5% year-over-year to $533 per client. The company generated free cash flow of $4.5 million and ended the fourth quarter with $247.0 million in cash, investments and no debt. Stitch Fix expects net revenue between $303 million and $310 million for the first quarter of fiscal 2025 and between $1.11 billion and $1.16 billion for the full-year fiscal 2025.

Stitch Fix, Inc. (SFIX) shares ended the week at $2.84, down 28% for the week.

The Dow started the week of 9/23 at 42,060 and closed at 42,313 on 9/27. The S&P 500 started the week at 5,712 and ended at 5,738. The NASDAQ started the week at 17,995 and finished at 18,120.

Treasury yields varied earlier in the week as investors digested the latest economic data and the recent interest rate reductions from the Federal Reserve. Yields rose towards the end of the week as additional reports signaled strong economic conditions.

On Thursday, the Commerce Department’s Bureau of Economic Analysis announced that the revised estimate for Gross Domestic Product (GDP), a monetary measure of the market value of all the final goods and services produced in a given time period, increased 3.0% in the second quarter of 2024. This was slightly better than economists’ expectations of a 2.9% growth and higher than the 1.4% growth achieved in the first quarter of 2024.

“The revisions only strengthen our conviction that the US economy will continue to expand at a decent pace over the coming year, which suggests labor market conditions are unlikely to deteriorate markedly from here,” said deputy chief economist at Oxford Economics, Michael Pearce.

The benchmark 10-year Treasury note yield opened the week of September 23 at 3.74% and traded as high as 3.83% on Thursday. The 30-year Treasury bond opened the week at 4.08% and traded as high as 4.17% on Thursday.

On Thursday, the U.S. Department of Labor reported that initial claims for unemployment decreased by 4,000 to 218,000 for the week ending September 21. Continuing unemployment claims increased by 13,000, reaching 1.83 million.

“The economy remains strong and the need for additional large rate cuts are questionable if the economy continues to move forward at a brisk pace,” said chief economist at FWDBONDS, Christopher Rupkey.

The 10-year Treasury note yield finished the week of 9/23 at 3.75%, while the 30-year Treasury note yield finished the week at 4.09%.

Freddie Mac released its latest Primary Mortgage Market Survey on Thursday, September 26. The survey showed the 30-year mortgage rate reaching its lowest level since September 2022.

This week, the 30-year fixed rate mortgage averaged 6.08%, down from last week’s average of 6.09%. Last year at this time, the 30-year fixed rate mortgage averaged 7.31%.

The 15-year fixed rate mortgage averaged 5.16% this week, down from last week’s 5.15%. During the same week last year, the 15-year fixed rate mortgage averaged 6.72%.

“Although this week’s decline was slight, the 30-year fixed-rate mortgage trended down to its lowest level in two years,” said Freddie Mac’s Chief Economist, Sam Khater. “Given the downward trajectory of rates, refinance activity continues to pick up, creating opportunities for many homeowners to trim their monthly mortgage payment. Meanwhile, many looking to purchase a home are playing the waiting game to see if rates decrease further as additional economic data is released over the next several weeks.”

Based on published national averages, the savings rate was 0.46% as of 9/16. The one-year CD averaged 1.88%.

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