AutoZone reports fiscal Q3 results on May 26 with the stock recovering from a rough month — and the options market now leaning more bullish than it has all year.
The clearest shift since the last note is in options sentiment. The put/call ratio has dropped to 0.67, below its 20-day average of 0.69 and closing in on the 52-week low of 0.51. That's a meaningful reversal from mid-May, when the PCR was running closer to 0.77. Call demand is outpacing puts — a sign that options traders have rotated toward upside exposure ahead of the release, not downside protection. The stock itself has partially recovered, up 2.6% on the week to $3,406.50, though it remains down 5.5% over the past month. The borrow market stays relaxed: cost to borrow ticked up 10% on the week to a still-negligible 0.43%, and availability remains extraordinarily loose at over 7,300% — roughly 73 shares available for every one currently lent out.
Short interest is low and stable, telling a less alarming story than the month-over-month trend implies. At 2.1% of the free float, the level has barely moved week-on-week — the bulk of the 15% monthly build happened in a concentrated burst in late April and has since plateaued. The ORTEX short score has drifted lower all week, now at 30.6, well below the midpoint of its range. This is not a setup where short positioning looks aggressive or where squeeze risk is a live factor.
The analyst debate centres on whether AutoZone's structural advantages can hold up against near-term headwinds. Bulls point to the dominant U.S. store network, distribution depth, and international expansion in Mexico and Brazil as durable earnings drivers — and most analysts who revised targets after the last print moved them higher, with Citigroup, Oppenheimer, and JPMorgan all lifting numbers in early March. Bears counter that tariff exposure on imported parts, deflation risk in commodity-linked SKUs, and the creeping growth of online alternatives could compress margins even if same-store sales hold up. The consensus sits at hold, and analyst activity since mid-March has been quiet — the last substantive move was TD Cowen trimming its target to $4,250 while keeping a Buy. Mean targets from that cluster sit well above the current price, though that data is now roughly two months old.
Past Q3 prints have not rewarded holders in the immediate aftermath — the stock fell around 3% in the session following the March 2026 report and shed nearly 10% over the subsequent five trading days. The May 26 print will test whether the month's recovery has correctly anticipated a cleaner quarter, or whether the tariff and margin questions bears have been raising prove harder to dismiss than the options market currently suggests.
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