The market had a tough time digesting AutoZone, Inc.'s (NYSE:AZO) fourth-quarter earnings result Tuesday. Initially,

after management released results, the market sent shares up roughly 4% before those gains immediately reversed into a 5.6% decline by the end of the day. Despite shares rising consistently for much of the past decade, AutoZone's stock price has shed nearly a third of its value in 2017. Yet there were signs of life within its fourth-quarter results -- here are some highlights and takeaways.

By the numbers

AutoZone was able to shake off slower than anticipated sales earlier this year with a modest 3.3% increase in net sales to $3.5 billion during the fourth quarter. That was just slightly above analysts' estimates calling for $3.49 billion, and the result was partly driven by a 1% increase in comparable store sales. Earnings per share jumped 6.8% to $15.27, up from the prior year's $14.30 per share. Yet excluding a $0.09 per-share benefit from a new accounting standard, adjusted earnings per share checked in at $15.18. That was good enough to top analysts' estimates calling for $15.12 per share. With those figures out of the way, here are a couple of takeaways from the data.

Man at an automotive store

Image source: Getty Images.

Commercial growth

Arguably the biggest growth story for AutoZone in recent years has been its expansion from do-it-yourself (DIY) consumers to both DIY and do-it-for-me commercial sales. Its number of commercial programs at stores increased 4.6% to 4,592 programs, which is roughly 84% of its domestic store count. Its domestic commercial sales jumped 5.9% during the fourth quarter to $672.5 million, which is just under 20% of its total fourth-quarter net sales.

The good news is that there's reason to believe there are still gains to be had for AutoZone's growing number of commercial programs. As the list of newer programs continues to mature -- a process that could take a few years to develop a commercial customer base -- its comparable sales and total sales should both climb higher in the near term.

Hurricane damage

As hurricanes Irma and Harvey ripped through parts of the country, it was clear there would be would be massive implications for many companies. AutoZone was able to reopen all of the 600 stores closed -- roughly 10% of its store count -- as a result of the hurricanes, but the pain might not be over just yet.

Said William Rhodes, AutoZone chairman, president, and CEO, on the fourth-quarter conference call:

Through our team's heroic efforts, all of our stores were back open in the middle of last week. We did sustain damage to some stores and are still determining the ultimate cost that will be recorded in our first quarter. But at this time, we do not expect those costs to be material. Our efforts have now turned to Hurricane Maria, which appears headed directly to Puerto Rico tomorrow.

Shareholder value

One of the stories with AutoZone has been its aggressive share repurchase program, which has dramatically reduced its shares outstanding over the years and thus generated higher earnings per share.

AZO Shares Outstanding data by YCharts

During the fourth quarter, AutoZone repurchased 366,000 shares of common stock for $227 million, bringing its year-to-date total to 1.5 million shares of its common stock for $1.07 billion. And while that's a hefty chunk, the company still has about $824 million remaining under its current share repurchase authorization.

Going forward

If you're asking why AutoZone's stock declined after the company topped analysts' estimates, the answer is simply the looming, Inc. threat. Many investors are wary of buying into AutoZone as some of its do-it-yourself business could be threatened from the internet retail juggernaut. That's also why investors need to keep an eye on AutoZone's commercial growth, a segment that will be less impacted by internet sales as professional repair shops and commercial consumers will need specialized inventory quickly. For now, investors should remain optimistic that AutoZone's comparable sales growth has returned in the fourth quarter, it continues to return value through an aggressive share repurchase program, and it continues to generate more sales from its commercial segment.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.