O’Reilly Automotive Earnings: Here’s Why the Stock is Rising Now

O’Reilly Automotive Inc. (NASDAQ:ORLY) delivered a profit and beat Wall Street’s expectations, BUT came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company. Shares are up 2.30%.

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O’Reilly Automotive Inc. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased 19.3% to $1.36 in the quarter versus EPS of $1.14 in the year-earlier quarter.

Revenue: Rose 3.64% to $1.59 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: O’Reilly Automotive Inc. reported adjusted EPS income of $1.36 per share. By that measure, the company beat the mean analyst estimate of $1.35. It missed the average revenue estimate of $1.61 billion.

Quoting Management: “We are pleased to report a solid start to 2013, highlighted by a 19% increase in diluted earnings per share to $1.36, representing our 17th consecutive quarter of 15% or greater adjusted diluted earnings per share growth,” commented Greg Henslee, President and CEO. “The solid sales trend we experienced in the fourth quarter of 2012 continued into the first quarter of 2013, where we faced our most difficult quarterly comparable store sales comparisons for the year. As a reminder, the first quarter included headwinds from the 2012 Leap Day, the pull forward of business into the first quarter of 2012 due to the early spring weather we experienced across most of our markets last year and the timing of the Easter holiday this year. The Leap Day in 2012, combined with the timing of the Easter holiday, which fell in the second quarter of 2012 and the first quarter of 2013, resulted in a headwind of approximately 150 bps for the first quarter this year. Adjusted for the impact of the Leap Day in 2012, our comparable store sales for the first quarter of 2013 were 1.9% on top of a very strong Leap Day adjusted comp of 6.1% in the first quarter last year. With the onset of spring weather in many markets, we are seeing a strong seasonal sales volume trend so far in April, and remain confident in the strength of the long-term demand drivers for our industry. We will continue to focus on executing our proven strategy of serving both retail and professional service provider customers, and we are reiterating our full-year comparable store sales guidance of 3% to 5%.”

Key Stats (on next page)…

Revenue increased 6.49% from $1.49 billion in the previous quarter. EPS increased 19.3% from $1.14 in the previous quarter.

Looking Forward: Analysts have a more positive outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has risen from a profit of $1.38 to a profit $1.45. For the current year, the average estimate has moved up from a profit of $5.43 to a profit of $5.72 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)

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