What to Expect From O'Reilly Automotive’s Upcoming Q4 Results?
RBC Capital analysts provided their outlook on O'Reilly Automotive, Inc. (NASDAQ:ORLY) ahead of the upcoming Q4 results, expecting net sales growth of 6.2% (vs. Street’s 6.4%), comp sales growth of 4.2% (vs. Street’s 4.5%), and EPS of $7.58 (vs. Street’s $7.74).
The analysts believe DIY trends have decelerated sequentially from Q3, but expect continued professional strength will more than offset this. According to the analysts, the risk for the quarter lies with the guide, noting they would not be surprised if management conservatively guided 2023 EPS below consensus. This could cause a negative knee-jerk reaction, but at this point management's over-delivery track record should be well understood.
The analysts reiterated their Outperform rating and $895 price target, mentioning that they would be buyers in the event of any weakness.
| Symbol | Price | %chg |
|---|---|---|
| BELI.JK | 450 | 0 |
| MAPA.JK | 830 | 0 |
| BUKA.JK | 151 | 0 |
| ACES.JK | 765 | 0 |
O'Reilly Automotive Named Top Sector Pick, Analyst Sees Strong 2025 Performance
O'Reilly Automotive (NASDAQ:ORLY) remains TD Cowen’s top stock pick in the sector, with analysts reaffirming a Buy rating and a $1,400 price target. Despite expectations of a sluggish year for the industry, O'Reilly's combination of offensive and defensive strengths positions it for market-leading comparable sales growth in 2025, particularly driven by a stronger "Do-It-For-Me" (DIFM) business.
TD Cowen anticipates a fourth-quarter beat on both comparable sales and earnings per share (EPS) and believes management could guide for 2025 comparable sales growth of 2-4%. This would be a cautious outlook given the mixed consumer environment, but the analysts suggest O’Reilly could raise its guidance later in the year if conditions improve. Alternatively, the company may issue a more historically typical range of 3-5% growth from the start.
Valuation remains attractive, supported by ORLY’s best-in-class execution and a scarcity premium. However, the analysts acknowledge that O’Reilly’s price-to-earnings premium over competitor AutoZone has now stretched beyond historical norms, exceeding two standard deviations above past trends.
Despite this, ORLY continues to stand out as a high-quality stock in the auto parts retail sector, offering both resilience in a challenging economic climate and upside potential from its operational excellence. Investors looking for stability and growth may find O’Reilly a compelling choice in 2025.
O'Reilly Automotive Upgraded to Buy at Citi
Citi analysts upgraded their rating on O'Reilly Automotive (NASDAQ:ORLY) from Neutral to Buy and raised the 12-month price target on the stock from $983.00 to $1,040.00. This decision comes after a recent decline in the stock's price. The analysts stated that they believe the recent dip in shares presents an attractive buying opportunity, especially for a stable and defensive retailer.
Citi acknowledged the challenging environment expected in the retail sector, with reduced consumer spending on non-essential items anticipated in the latter half of 2023 and throughout 2024. They also noted difficulties in execution within defensive sectors.
However, the analysts highlighted the automotive parts retail industry's resilience, with O'Reilly being the standout historically consistent player among auto parts retailers. Citi expects O'Reilly to demonstrate strong execution in the near to medium term.
O'Reilly Automotive’s Upcoming Q1 Earnings Preview
RBC Capital analysts provided a preview on O'Reilly Automotive (NASDAQ:ORLY) ahead of the upcoming Q1 earnings announcement, scheduled on Wednesday.
The analysts expect the company to report comp sales growth of 6.2% (vs. Street’s 6.6%) and EPS of $7.89 (vs. Street’s $7.96).
According to the analysts, the company should continue to benefit from an uncertain macro backdrop, but at 22x consensus 2024 EPS estimate, they wouldn't necessarily be adding to positions ahead of the print. The analysts reiterated their Outperform rating and $900 price target on the company’s shares.
