O’Reilly Automotive Inc. (ORLY) revealed that its board of directors has approved a resolution that will enhance the authorization amount under its existing share repurchase program by $500 million, effective for a three-year period which began on November 12. With this, the aggregate authorization amount under the program has been increased to $3.0 billion.
Since the inception of the share repurchase program in January 2011 until October 25, O’Reilly has repurchased 30.1 million shares at an average price of $74.45, implying a total investment of $2.24 billion. During the third quarter of the year, the company has repurchased 6.4 million shares of its common stock at an average price of $84.76, implying a total investment of $539.0 million.
Subsequent to the end of the third quarter until October 25, the company has repurchased an additional 1.5 million shares for an average price of $83.49, implying a total investment of $128.0 million.
During the first nine months of the year, the company has repurchased 12.6 million shares at an average price of $89.62, leading to a total investment of $1.13 billion.
O’Reilly Automotive, a Zacks #2 Rank (Buy) stock, saw a 20% increase in earnings per share to $1.32 in the third quarter of 2012 from $1.10 in the same period last year. Quarterly earnings also surpassed the Zacks Consensus Estimate by 5 cents per share. Net income increased 7.3% to $159.3 million (9.9% of sales) from $148.4 million (9.7%) in the third quarter of 2011.
Revenues in the quarter rose 4.3% to $1.60 billion from $1.54 billion a year ago, marginally missing the Zacks Consensus Estimate of $1.62 billion. Comparable store sales (change in sales for stores open at least one year) stood at 1.3% compared with 4.8% in the third quarter of 2011.
Operating income improved 9.2% to $263.3 million from $241.0 million a year ago, while operating margin improved to 16.4% from 15.7% in the third quarter of 2011.
For the fourth quarter of the year, O’Reilly expects earnings per share of $1.03 to $1.07 and consolidated comparable store sales to increase in the range of 2% to 4%.
For full year 2012, the company anticipates earnings per share in the range of $4.64 to $4.68, up from the previous guidance of $4.56 to $4.66. It expects lower consolidated comparable store sales of 3%-4% compared with the prior guidance of 3%-5%.
O'Reilly lowered its revenue guidance to $6.15 billion–$6.20 billion from $6.15 billion–$6.25 billion. The company expects gross margin between 49.8% and 50.0% and operating margin between 15.5% and 15.8% for the year.
O'Reilly Automotive is the third largest specialty retailer of automotive aftermarket parts, tools, supplies, equipment, and accessories in the U.S., selling products to both Do-it-Yourself (:DIY) customers and Do-it-for-Me (:DIFM) or professional installers.
The company sells an extensive line of products consisting of new and remanufactured automotive hard parts (such as mufflers, brakes, and shock absorbers), maintenance items, accessories, a complete range of auto body paint and related materials, automotive tools and professional service equipment. Its main competitors are Advance Auto Parts Inc. (AAP) and AutoZone Inc. (AZO).
More From Zacks.com