O'Reilly Auto (ORLY) AI Stock Analysis

• Market Cap: $79.56B
• Dividend Yield: N/A
• Average Volume (3M): 410.00K
• Price to Earnings (P/E): 34.2
• Beta (1Y): 0.30
• Revenue Growth: 5.67%
• EPS Growth: 5.40%
• Country: US
• Employees: 93,176
• Sector: Consumer Cyclical
• Sector Strength: 60
• Industry: Specialty Retail
• EPS (TTM): 40.66
• Shares Outstanding: 57,240,513
• 10 Day Avg. Volume: 467,574
• 30 Day Avg. Volume: 409,995
• PEG Ratio: 6.34
• Price to Book (P/B): N/A
• Price to Sales (P/S): 4.59
• Price to Cash Flow (P/CF): 30.70
• P/FCF Ratio: 28.70
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $1,433.82
• Price Target Upside: 7.50% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 18

O'Reilly Auto's stock is supported by strong financial performance and cash flows, although high leverage and negative equity pose risks. Technical indicators are mixed, and the valuation appears high, reflecting growth expectations. The earnings call highlights both achievements and challenges, while the stock split presents a positive corporate event with potential to enhance market interest.

Positive Factors

Automation and Operational Efficiency

O'Reilly Auto's new distribution center outside Atlanta includes automation technologies, enhancing productivity in a traditionally labor-intensive model.

Market Expansion

Management is planning to open between 200 and 210 new stores in 2025, including about 25 in Mexico, which indicates growth and expansion.

Sales Growth

Sales increased by 6.9% year-over-year, surpassing expectations, indicating strong company performance.

Negative Factors

Consumer Pressure

ORLY faced headwinds from broad-based consumer pressure and continued discretionary softness.

Margin Pressure

Margins came in below expectations, leading to an EPS miss.

Self-Insurance Costs

Self-insurance costs are rising for the company's delivery fleet, which could impact future profitability.

O'Reilly Auto Business Overview & Revenue Model

Company Description

O'Reilly Automotive, Inc., together with its subsidiaries, operates as a retailer and supplier of automotive aftermarket parts, tools, supplies, equipment, and accessories in the United States. The company provides new and remanufactured automotive hard parts and maintenance items, such as alternators, batteries, brake system components, belts, chassis parts, driveline parts, engine parts, fuel pumps, hoses, starters, temperature control, water pumps, antifreeze, appearance products, engine additives, filters, fluids, lighting products, and oil and wiper blades; and accessories, including floor mats, seat covers, and truck accessories. Its stores offer auto body paint and related materials, automotive tools, and professional service provider service equipment. The company's stores also provide enhanced services and programs comprising used oil, oil filter, and battery recycling; battery, wiper, and bulb replacement; battery diagnostic testing; electrical and module testing; check engine light code extraction; loaner tool program; drum and rotor resurfacing; custom hydraulic hoses; and professional paint shop mixing and related materials. Its stores offer do-it-yourself and professional service provider customers a selection of products for domestic and imported automobiles, vans, and trucks. As of December 31, 2021, the company owned and operated 5,759 stores in the United States, and 25 stores in Mexico. O'Reilly Automotive, Inc. was founded in 1957 and is headquartered in Springfield, Missouri.

How the Company Makes Money

O'Reilly Auto Parts generates revenue primarily through the sale of automotive parts and accessories. The company operates a dual market strategy, targeting both professional service providers and do-it-yourself customers, which allows it to capture a broad market segment. Revenue streams include sales from its extensive inventory of automotive parts, maintenance items like batteries and fluids, and a variety of accessories. The company benefits from significant economies of scale, enabling competitive pricing and a wide distribution network. O'Reilly also focuses on strategic partnerships with suppliers to ensure a steady supply of quality products, which contributes to its sustained earnings. Additionally, the company's loyalty programs and marketing initiatives help drive repeat customer business, further bolstering its revenue.

O'Reilly Auto Financial Statement Overview

Summary

O'Reilly Auto demonstrates strong financial performance with consistent revenue growth, high profitability margins, and robust cash flows, indicating operational efficiency. However, high leverage and negative equity in the balance sheet pose financial risks, necessitating improvements in equity management.

Income Statement

O'Reilly Auto has demonstrated consistent revenue growth over the years, with a notable increase from $10.15 billion in 2019 to $16.71 billion in 2024. The gross profit margin is strong at 51.2% for 2024, reflecting efficient cost management. Net profit margin stands at 14.28% for 2024, indicating solid profitability. The EBIT and EBITDA margins are robust, both at 19.45% for 2024, showcasing operational efficiency. Overall, the company exhibits strong financial performance with stable growth and profitability.

Balance Sheet

O'Reilly Auto's balance sheet shows a concerning negative stockholders' equity of $1.37 billion in 2024, primarily due to high total debt of $7.92 billion. The debt-to-equity ratio is not meaningful due to negative equity. Despite this, the return on equity is impressive at -174.11%, driven by substantial net income. The equity ratio is negative, highlighting the need for improved equity management. While the company's profitability is strong, the high leverage poses financial risk.

Cash Flow

The company exhibits healthy operating cash flows, reaching $3.05 billion in 2024, indicating strong cash generation capability. The free cash flow is solid at $2.03 billion for 2024, with a stable growth rate over the years. The operating cash flow to net income ratio is 1.28, reflecting efficient conversion of income to cash. The free cash flow to net income ratio is 0.85, suggesting effective cash management despite high capital expenditures. Overall, the cash flow position is strong, supporting ongoing operations and investments.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
16.71B	15.81B	14.41B	13.33B	11.60B
	Gross Profit
8.55B	7.70B	7.38B	7.02B	6.09B
	EBIT
3.25B	3.19B	2.95B	2.92B	2.42B
	EBITDA
3.25B	3.60B	3.31B	3.25B	2.74B
	Net Income Common Stockholders
2.39B	2.35B	2.17B	2.16B	1.75B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
130.25M	279.13M	108.58M	362.11M	465.64M
	Total Assets
14.89B	14.60B	12.63B	11.72B	11.60B
	Total Debt
7.92B	7.84B	6.55B	5.87B	6.16B
	Net Debt
7.79B	7.56B	6.44B	5.50B	5.70B
	Total Liabilities
16.26B	16.34B	13.69B	11.79B	11.46B
	Stockholders Equity
-1.37B	-1.74B	-1.06B	-66.42M	140.26M
Cash Flow		Free Cash Flow
2.03B	2.03B	2.58B	2.76B	2.37B
	Operating Cash Flow
3.05B	3.03B	3.15B	3.21B	2.84B
	Investing Cash Flow
-1.17B	-995.94M	-739.99M	-615.62M	-614.89M
	Financing Cash Flow
-2.03B	-1.87B	-2.66B	-2.69B	-1.80B

O'Reilly Auto Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1333.84
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ORLY, the sentiment is Negative. The current price of 1333.84 is below the 20-day moving average (MA) of 1367.88, below the 50-day MA of 1341.31, and above the 200-day MA of 1203.53, indicating a neutral trend. The MACD of 27.13 indicates Negative momentum. The RSI at 68.37 is Neutral, neither overbought nor oversold. The STOCH value of 82.23 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ORLY.

O'Reilly Auto Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TSCO	75 Outperform	$27.86B	25.68	49.83%	1.70%	2.25%	1.00%
AZO	73 Outperform	$61.11B	24.50	-14.95%	―	4.72%	4.69%
ORLY	70 Outperform	$79.56B	34.18	-174.09%	―	5.67%	5.40%
CVNA	70 Outperform	$34.70B	103.40	27.94%	―	26.94%	-57.88%
GPC	68 Neutral	$16.21B	18.05	20.69%	3.45%	1.71%	-30.78%
Sector *	59 Neutral	$11.18B	10.04	-1.58%	3.96%	1.31%	-16.97%
AAP	45 Neutral	$2.09B	59.62	-23.45%	2.86%	-9.34%	-852.37%

O'Reilly Auto Corporate Events

O’Reilly Auto Announces Q1 2025 Earnings Release Date

On April 1, 2025, O’Reilly Automotive, Inc. announced the release date for its first quarter 2025 earnings results, scheduled for April 23, 2025, with a conference call to follow on April 24, 2025. This announcement is significant for stakeholders as it provides an opportunity to gain insights into the company’s financial performance and strategic direction for the first quarter of 2025.

O’Reilly Auto Announces 15-for-1 Stock Split

On March 13, 2025, O’Reilly Automotive, Inc. announced a 15-for-1 stock split approved by its Board of Directors, pending shareholder approval to increase authorized shares. This move aims to make stock more accessible to employees, aligning with the company’s goal of sharing success with team members. If approved, shareholders as of June 2, 2025, will receive additional shares, with trading on a post-split basis beginning June 10, 2025.