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O'Reilly Automotive (ORLY) Dips More Than Broader Markets: What You Should Know

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In the latest trading session, O'Reilly Automotive (ORLY) closed at $624.83, marking a -1.58% move from the previous day. This move lagged the S&P 500's daily loss of 1.08%. At the same time, the Dow lost 0.81%, and the tech-heavy Nasdaq gained 0.22%.

Heading into today, shares of the auto parts retailer had gained 3.76% over the past month, outpacing the Retail-Wholesale sector's loss of 26.61% and the S&P 500's gain of 1.03% in that time.

O'Reilly Automotive will be looking to display strength as it nears its next earnings release. In that report, analysts expect O'Reilly Automotive to post earnings of $8.96 per share. This would mark year-over-year growth of 7.56%. Meanwhile, our latest consensus estimate is calling for revenue of $3.71 billion, up 7% from the prior-year quarter.

ORLY's full-year Zacks Consensus Estimates are calling for earnings of $32.68 per share and revenue of $14.3 billion. These results would represent year-over-year changes of +5.08% and +7.27%, respectively.

Investors might also notice recent changes to analyst estimates for O'Reilly Automotive. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. O'Reilly Automotive currently has a Zacks Rank of #3 (Hold).

Digging into valuation, O'Reilly Automotive currently has a Forward P/E ratio of 19.43. This represents a premium compared to its industry's average Forward P/E of 17.11.

Also, we should mention that ORLY has a PEG ratio of 1.54. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Automotive - Retail and Wholesale - Parts stocks are, on average, holding a PEG ratio of 1.31 based on yesterday's closing prices.

The Automotive - Retail and Wholesale - Parts industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 232, which puts it in the bottom 9% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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