PineStone Scaled Back AutoZone Amid Record Stock Surge — But Here’s Why It’s Still a Core Holding

On Friday, PineStone Asset Management Inc. disclosed in a Securities and Exchange Commission filing that it sold AutoZone (NYSE:AZO) shares for an estimated $65.7 million in the third quarter.

What Happened

According to a filing with the U.S. Securities and Exchange Commission released on Friday, PineStone Asset Management Inc. reduced its stake in AutoZone (NYSE:AZO) by 16,388 shares during the third quarter. The estimated value of the shares sold was $65.7 million. After the sale, PineStone reported holding 265,305 shares valued at $1.1 billion as of September 30.

What Else to Know

This was a partial sale; AutoZone now represents 7.1% of PineStone’s 13F assets under management as of September 30.

Top five holdings after the filing:

• NYSE:TSM: $1.8 billion (11.4% of AUM)
• NASDAQ:GOOGL: $1.6 billion (9.7% of AUM)
• NASDAQ:MSFT: $1.5 billion (9.37% of AUM)
• NYSE:AZO: $1.1 billion (7.1% of AUM)
• NYSE:MCO: $1.1 billion (6.7% of AUM)

As of Friday's market close, AutoZone shares were priced at $4,030.17, up 25% over the past year and outperforming the S&P 500's nearly 14% gain in the same period.

Company Overview

Company Snapshot

• AutoZone offers a comprehensive range of automotive replacement parts, maintenance items, accessories, and related products for cars, SUVs, vans, and light trucks, including both new and remanufactured components.
• The retailer operates a retail and distribution business model, generating revenue through in-store sales, commercial delivery programs, and online channels, including proprietary diagnostic software under the ALLDATA brand.
• It serves a broad customer base of do-it-yourself consumers and professional automotive repair shops across the United States, Mexico, and Brazil.

AutoZone is a leading retailer and distributor in the automotive aftermarket sector, leveraging its extensive store network, product assortment, and integrated commercial programs to maintain a strong market position.

Foolish Take

Montreal-based PineStone Asset Management trimmed its position in AutoZone last quarter, selling about $65.7 million worth of shares but retaining a sizable $1.1 billion stake that still ranks among its top holdings. With AutoZone continuing to represent 7.1% of PineStone’s 13F assets, the move looks more like portfolio fine-tuning than a shift in conviction.

After all, AutoZone’s fundamentals remain strong despite a slight pullback. The retailer’s most recent results showed same-store sales growth of 5.1% and full-year EPS of $144.87, supported by a 14% increase in inventory to fuel new store openings and commercial expansion. CEO Phil Daniele credited continued strength in both the do-it-yourself and commercial segments and reaffirmed the company’s “disciplined approach of increasing earnings and cash flow.”

Shares have fallen about 7% since hitting a record high in mid-September, suggesting investors are consolidating gains after a long rally. For long-term investors, AutoZone’s consistent cash generation, share buybacks, and durable demand for aftermarket parts remain a solid foundation for steady value creation—especially as the company continues to expand domestically and around the world.

Glossary

13F reportable assets: Assets that institutional investment managers must disclose quarterly in SEC Form 13F filings.
Assets under management (AUM): The total market value of investments managed on behalf of clients by a fund or firm.
Partial sale: Selling only a portion of a holding, rather than the entire position, in a security or asset.
Holding: The amount of a particular security or asset owned by an investor or fund.
Outperforming: Achieving a higher return than a specified benchmark or index over a given period.
Distribution business model: A strategy where a company sells products through both retail locations and delivery to commercial customers.
Proprietary diagnostic software: Specialized software owned and developed by a company, used for vehicle diagnostics or other technical purposes.
Remanufactured components: Used parts that have been restored to like-new condition for resale.
Commercial delivery programs: Services that provide direct delivery of products to business or professional customers.
TTM: The 12-month period ending with the most recent quarterly report.

Jonathan Ponciano has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Microsoft, Moody's, and Taiwan Semiconductor Manufacturing. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.