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On Thursday, Truist Securities expressed continued confidence in O'Reilly Automotive (NASDAQ:ORLY), maintaining a Buy rating and a price target of $1,313.00. Currently trading at $1,254.65, the stock sits near its 52-week high of $1,283.96, with analyst targets ranging from $870 to $1,450. InvestingPro analysis suggests the stock is trading above its Fair Value, with 12 key insights available to subscribers. The firm's analysis, based on Truist Card Data, indicates that the company's sales have modestly exceeded market expectations. With revenue growth of 5.25% over the last twelve months and a robust gross profit margin of 51.2%, the company has demonstrated resilient performance. Despite the challenges posed by the harsh January weather, which has hampered vehicle repairs outdoors, Truist anticipates a rebound in comparable store sales growth in 2025.
The optimism for a sales upturn is partly due to the severe weather conditions, which are expected to lead to increased part breakage. Additionally, the firm projects that O'Reilly will benefit from cycling against the weaker discretionary performance of 2024 and from inflation on the same stock keeping units (SKUs). While tariffs are considered an uncertain factor, Truist suggests that O'Reilly and its peers could significantly benefit if tariffs were to increase.
Truist's outlook for the auto parts sector remains bullish for 2025, with the expectation that O'Reilly Automotive will continue to capture a significant share of the market. The firm encourages investors to consider O'Reilly as a strong buying opportunity, citing the company's potential to outperform within the industry. For deeper insights into O'Reilly's financial health (rated 'GOOD' by InvestingPro) and comprehensive valuation metrics, investors can access the detailed Pro Research Report, available exclusively to subscribers.
In other recent news, O'Reilly Automotive has seen several significant developments. Following Q3 earnings per share (EPS) of $10.55, which slightly missed estimates, the company revised its 2024 guidance downward, expecting EPS between $40.60 and $41.10. The company also announced a $2 billion increase in its share repurchase program, raising the total authorization to $27.75 billion.
Morgan Stanley (NYSE:MS) upgraded O'Reilly Automotive's stock to Overweight, citing a positive business cycle turn and a robust long-term outlook. In addition, TD Cowen analysts raised their price target on O'Reilly Automotive shares to $1,400, maintaining a Buy rating, while BMO Capital initiated coverage with an Outperform rating and a price target of $1,400.
Roth/MKM maintained a Buy rating on O'Reilly Automotive, setting a target price of $1,337, while other firms such as Mizuho (NYSE:MFG), Truist Securities, UBS, and Jefferies also raised their price targets for the company. O'Reilly Automotive expanded its geographical footprint, opening 47 new stores in Q3, bringing the total to 111 for the year. These are the recent developments in the company's trajectory.
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