O'Reilly (ORLY) to Report Q1 Earnings: What's in Store?

Zacks Equity Research

April 22, 2024 at 2:03 p.m.·5 min read

O’Reilly Automotive ORLY is slated to release first-quarter 2024 results on Apr 24, after the closing bell. The Zacks Consensus Estimate for the to-be-reported quarter’s earnings per share (EPS) and revenues is pegged at $9.18 and $3.96 billion, respectively.

For the first quarter, the consensus estimate for O’Reilly’s earnings has moved down a penny in the past seven days. Its bottom-line estimates imply 10.87% growth from the year-ago reported numbers.

The Zacks Consensus Estimate for ORLY's quarterly revenues implies a year-over-year increase of 6.87%. The company's earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 2.69%. This is depicted in the graph below:

O'Reilly Automotive, Inc. Price and EPS Surprise

O'Reilly Automotive, Inc. price-eps-surprise | O'Reilly Automotive, Inc. Quote

Q4 Highlights

In the fourth quarter of 2023, ORLY’s adjusted EPS of $9.26 beat the Zacks Consensus Estimate of $9.07 and increased from $8.37 reported in the year-ago quarter. The company reported net sales of $3,832 million, which missed the Zacks Consensus Estimate of $3,838 million. The top line rose 5.2% year over year.

Things to Note

Per Cox Automotive, the U.S. new vehicle sales in the first quarter of 2024 are anticipated to rise 5.6% year over year to 3.8 million units. O’Reilly is expected to have benefited from an increase in demand for new vehicles in the to-be-reported quarter. We expect comparable sales growth to be 5.5% in the first quarter of 2024.

The automotive parts retailer has been generating record revenues for 31 consecutive years on the back of growth in the auto parts market and expansion of the store base. Customer-centric business model and growing demand for technologically advanced auto parts are likely to have bolstered O’Reilly’s performance in the first quarter.

Upbeat projections for full-year 2024 revenues and EPS spark optimism surrounding the company’s result in the to-be-reported quarter. O’Reilly projects 2024 total revenues in the range of $16.8-$17.1 billion, up from $15.80 billion generated in 2023. EPS is expected between $41.05 and $41.55, up from $38.47 reported in 2023.

On the flip side, while the soaring popularity of electric and driverless cars is opening doors of opportunities for the firm, high capex to develop advanced superior offerings might have limited its cash flows in the first quarter. Notably, the company generated FCF of $2 billion in 2023, down from $2.4 billion in 2022.

Also, while the acquisition of Groupe Del Vasto in Canada will boost long-term prospects, it is expected to have acted as a headwind for the company in the first quarter.

Earnings Whispers

Our proven model does not conclusively predict an earnings beat for the automotive parts retailer for the quarter to be reported, as it does not have the right combination of the two key ingredients. A positive Earnings ESP, combined with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold), increases the odds of an earnings beat. This is not the case here.

Earnings ESP: ORLY has an Earnings ESP of -0.81%. This is because the Most Accurate Estimate is pegged lower than the Zacks Consensus Estimate. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: It currently carries a Zacks Rank #2.

Stocks With the Favorable Combination

Here are some players from the auto space that, per our model, have the correct ingredients to post an earnings beat this time around.

Oshkosh Corporation OSK has an Earnings ESP of +0.11% and a Zacks Rank #2 at present. The company is set to release first-quarter 2024 results on Apr 25. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for OSK’s to-be-reported quarter’s earnings and revenues is pegged at $2.26 per share and $2.51 billion, respectively. Oshkosh beat on earnings in each of the trailing four quarters, the average surprise being 46.78%.

Visteon Corporation VC has an Earnings ESP of +5.10% and a Zacks Rank #3 at present. The company is slated to release first-quarter 2024 results on Apr 25.

The Zacks Consensus Estimate for VC’s to-be-reported quarter’s earnings and revenues is pegged at $1.76 per share and $990.08 million, respectively. Visteon beat on earnings in two of the trailing four quarters and missed twice, the average surprise being 134.25%.

PACCAR Inc PCAR has an Earnings ESP of +0.33% and a Zacks Rank #2 at present. The company is scheduled to release first-quarter 2024 results on Apr 30.

The Zacks Consensus Estimate for PCAR’s to-be-reported quarter’s earnings and revenues is pegged at $2.17 per share and $8.08 billion, respectively. PACCAR beat on earnings in each of the trailing four quarters, the average surprise being 17.07%.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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O'Reilly Automotive, Inc. Price and EPS Surprise

Q4 Highlights

Things to Note

Earnings Whispers

Stocks With the Favorable Combination

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