O’Reilly Automotive Faces Mixed Results Amid Market Fluctuations
Springfield, Missouri-based O’Reilly Automotive, Inc. (ORLY) is one of the leading specialty retailers and suppliers of automotive aftermarket parts, tools, supplies, equipment, and accessories. The company boasts a market cap of $70.9 billion and operates over 6,200 stores across the United States, Mexico, and Canada.
2024 Performance and Market Comparison
O’Reilly’s stock has been strong in 2024, outperforming the broader market, but it has struggled over the past 52 weeks. Year-to-date, ORLY shares increased by 30.4% while experiencing a 25.5% rise over the last year. In comparison, the S&P 500 Index ($SPX) saw gains of 25.5% in 2024 and 31.3% over the past year.
Comparative Analysis with Retail ETFs
Further analysis shows that O’Reilly has also outperformed the SPDR S&P Retail ETF (XRT), which recorded a 16.2% increase year-to-date, but lags behind XRT’s impressive 31.5% returns over the past year.
Q3 Earnings Report and Market Reaction
Despite missing sales and earnings expectations, O’Reilly’s stock saw slight gains after the release of its Q3 earnings on October 23. The company reported a 1.5% year-over-year growth in comparable store sales as consumer demand showed signs of softness. During the quarter, O’Reilly opened 47 new stores and reported net sales of $4.4 billion, which was below Wall Street’s expectations. Earnings per share (EPS) also fell short, coming in at $11.41, missing analysts’ consensus estimates by more than 1%.
Positive Outlook Amid Challenges
Despite the recent challenges, O’Reilly’s core business fundamentals remain strong. The company has set its full-year revenue guidance between $16.6 billion and $16.8 billion, which has encouraged investor confidence.
Forecasts and Analyst Ratings
For the current fiscal year ending in December, analysts predict a 6.2% year-over-year increase in EPS to $40.85. O’Reilly’s earnings report history shows a mixed record; it has exceeded earnings estimates twice in the last four quarters while missing on two occasions.
Currently, ORLY stock holds a consensus “Moderate Buy” rating. Out of 25 analysts, 16 recommend “Strong Buy,” one suggests “Moderate Buy,” and eight advise a “Hold.”
Recent Updates on Analyst Ratings
This outlook is slightly more favorable than two months prior, when only 14 analysts rated the stock as “Strong Buy.” On October 25, analyst Max Rakhlenko from TD Cowen maintained his “Buy” rating and increased the price target to $1,375, implying nearly an 11% potential upside. The mean price target for ORLY is now $1,298.79, representing just a 4.8% premium to current levels, while the highest projected target of $1,400 indicates a possible 13% upside.
On the date of publication, Aditya Sarawgi did not hold positions, directly or indirectly, in any of the securities mentioned in this article. All information is for informational purposes only. For more details, please refer to the Barchart Disclosure Policy here.
The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
