O'Reilly Automotive Inc (ORLY, Financial) has recently been in the spotlight, drawing interest from investors and financial analysts due to its robust financial stance. With shares currently priced at $1,085.21, O'Reilly Automotive Inc has witnessed a daily gain of 1.49%, marked against a three-month change of 9.38%. A thorough analysis, underlined by the GF Score, suggests that O'Reilly Automotive Inc is well-positioned for substantial growth in the near future.
What Is the GF Score?
The GF Score is a stock performance ranking system developed by GuruFocus using five aspects of valuation, which has been found to be closely correlated to the long-term performances of stocks by backtesting from 2006 to 2021. The stocks with a higher GF Score generally generate higher returns than those with a lower GF Score. Therefore, when picking stocks, investors should invest in companies with high GF Scores. The GF Score ranges from 0 to 100, with 100 as the highest rank.
- Financial strength rank: 5/10
- Profitability rank: 10/10
- Growth rank: 10/10
- GF Value rank: 5/10
- Momentum rank: 9/10
Each one of these components is ranked and the ranks also have positive correlation with the long-term performances of stocks. The GF score is calculated using the five key aspects of analysis. Through backtesting, we know that each of these key aspects has a different impact on the stock price performance. Thus, they are weighted differently when calculating the total score. With a high profitability and growth rank, and a slightly lower financial strength and GF Value rank, GuruFocus assigned O'Reilly Automotive Inc the GF Score of 95 out of 100, which signals the highest outperformance potential.
Understanding O'Reilly Automotive Inc's Business
O'Reilly Automotive Inc is a leading aftermarket automotive parts retailer in the United States and Mexico, boasting nearly $16 billion in annual sales. With a market cap of $64.06 billion and sales of $15.81 billion, the company operates over 6,000 domestic stores. O'Reilly Automotive Inc caters to both the do-it-yourself (about 55% of sales) and professional (45% of sales) end markets. Despite the highly fragmented industry, O'Reilly Automotive Inc differentiates itself by providing quality service throughout the vehicle diagnosis and purchasing process. The firm's impressive hub-and-spoke distribution network is designed to ensure product availability across various vehicle makes and models, reinforcing its competitive edge.
Profitability Rank Breakdown
The Profitability Rank reflects O'Reilly Automotive Inc's superior ability to generate profits compared to its peers. The company's Operating Margin has seen a steady increase over the past five years, with figures rising from 18.92% in 2019 to 20.15% in 2023. This trend demonstrates O'Reilly Automotive Inc's efficiency in managing its operations and maintaining profitability.
The Piotroski F-Score further confirms O'Reilly Automotive Inc's solid financial situation, scoring high on Joseph Piotroski's nine-point scale, which assesses a company's profitability, funding, and operating efficiency. Additionally, the company's Predictability Rank of 5.0 stars out of five highlights its consistent operational performance, offering investors a reliable investment option.
Growth Rank Breakdown
O'Reilly Automotive Inc's high Growth Rank underscores its commitment to business expansion. The company's 3-Year Revenue Growth Rate of 18.5% surpasses 79.56% of companies in the Retail - Cyclical industry. O'Reilly Automotive Inc's EBITDA has also shown significant growth, with a three-year growth rate of 17.2 and a five-year rate of 19.7, indicating the company's sustained ability to drive profitability and growth.
Conclusion: O'Reilly Automotive Inc's Path to Market Outperformance
Considering O'Reilly Automotive Inc's strong financial strength, exceptional profitability, and impressive growth metrics, the GF Score highlights the firm's unparalleled position for potential outperformance. Investors looking for companies with similar robust financial health can explore more options using the GF Score Screen provided by GuruFocus. With its strategic initiatives and competitive advantages, O'Reilly Automotive Inc is poised to continue its trajectory of growth and market leadership. Will this automotive giant's winning streak accelerate in the fast lane of industry success?
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
