Shares of O'Reilly Automotive rallied on Thursday, a day after the auto-parts retailer reported fourth-quarter results that beat expectations and offered up a stronger-than-expected full-year sales forecast. The move put ORLY stock closer to a buy point.
Other auto-parts retailers tumbled, but were also in bases.
The results for O'Reilly arrived as more people put more miles on their vehicles, returning to daily commutes after a pandemic-induced office exodus. An ongoing supply-chain crunch has also pushed prices for chips, auto parts and cars higher.
The O'Reilly chain earned $7.64 per share during the quarter. That was above FactSet estimates for $6.06.
Revenue rose 16% to $3.291 billion, surpassing estimates for $3.112 billion. Same-store sales climbed 14.5%. That was also above Consensus Metrix estimates for a 7.6% gain.
"The 14.5% comps reflected a strong industry backdrop (including a likely growing contribution from inflation, increased miles driven, and an aging vehicle fleet — and despite gasoline price inflation) and continued operational excellence by the company," William Blair analyst Daniel Hofkin, who covers ORLY stock, said in a research note on Thursday.
O'Reilly's full-year forecast also came in above expectations. The chain forecast total revenue between $14.2 billion and $14.5 billion this year. That was above FactSet estimates for $13.67 billion.
O'Reilly also forecast a same-store-sales gain of 5% to 7%, better than FactSet's estimate for 1.7%.
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ORLY Stock Rises
Shares rose 2.85% to 658.45 in the stock market today. The move put the stock closer to its 50-day moving average and a flat-base buy point of 710.96.
ORLY stock has a strong 94 Composite Rating. Its EPS Rating is 90. Shares are off highs reached at the end of last year.
O'Reilly sells aftermarket auto parts to do-it-yourself customers and professional auto-service providers. The chain operated more than 5,700 stores nationwide and 25 stores in Mexico as of the end of last year.
In October, management, during its third-quarter earnings conference call, expressed some concern that rising prices could cause "more economically challenged customers to defer noncritical maintenance or trade down the product value spectrum."
However, it also noted that customers continued to opt for fixing their vehicles as ongoing vehicle shortages drive prices for both new and used vehicles to record highs. Auto production has been strained by a global chip shortage.
Among other auto-parts retailers, AutoZone slid 3.3% to 1939.54. That stock was also in a flat base, with a 2,110.10 buy point.
Advance Auto Parts lost 4.1% to 222.73. Shares were in a flat base with a 244.65 buy point.
IBD's Retail Wholesale Auto Parts industry group currently holds a strong No. 26 ranking out of 197 tracked.
