O'Reilly Automotive, Inc.
Orin's own judgment of how firmly the evidence points one way — not the chance the price goes up.
O'Reilly Automotive continues to post accelerating revenue growth — Q1 2026 rose 10.2% YoY and Q2 2026 8.1% YoY, well above FY2025's 6.4% full-year pace — with stable gross margins near 51.6% and operating margins near 19.5%.
However, free cash flow has deteriorated materially, with FCF margin compressing from 20.7% in 2021 to 9.0% in 2025 as capex nearly tripled to $1.17B, while total debt climbed to $8.49B against negative stockholders' equity of -$763M. At 28.2x P/E and 19.5x EV/EBITDA, ORLY trades at a rich premium to closest comp AutoZone at 20.0x P/E and 15.1x EV/EBITDA, and with smart money conviction fading to 0.02 as of Q2 2026 and net insider selling of 252,159 shares over 24 months, the risk/reward remains balanced rather than compelling despite the bullish technical setup with shares reclaiming the 50-day MA at $87.55.
What could go wrong
- FCF and balance sheet deterioration. FCF margin has compressed from 20.7% in 2021 to 9.0% in 2025 as capex nearly tripled to $1.17B, while total debt rose to $8.49B and stockholders' equity turned negative at -$763M, limiting financial flexibility.
- Valuation premium to closest peer. ORLY trades at 28.2x P/E and 19.5x EV/EBITDA versus AutoZone at 20.0x P/E and 15.1x EV/EBITDA, leaving little room for execution missteps.
- Fading institutional conviction. Smart money score declined from 0.10 as of Q2 2025 to 0.02 as of Q2 2026, and recent 13F filings show multiple funds trimming positions including Banque Pictet and Argent Capital.
- Persistent insider selling. Over the trailing 24 months insiders net sold 252,159 shares for $27.4M, with zero open-market acquisitions and recent sales by executives Hendrickson, Sastre, and Dumas in 2026.
What would change my mind
Where this comes from: quarterly results · FY25 fundamentals · peer comparison · 13F holdings. Orin's read on ORLY; not advice.
How has the share price moved?
Down 6.2% over twelve months, from $95.79 on 27 Oct 2025 to $89.82 at the Tue 27 Oct 2026 close. Its highest close in that time was $101.70 on 28 Nov 2025; the last close is 11.7% below it.
- Green line: the closing price each trading day.
- Grey line: the average closing price over the last 50 trading days.
- Dashed amber line: the same over the last 200 trading days — a slower, smoother line.
- Bars along the bottom: shares traded each day — green when it closed higher than the day before, rose when lower (the most, 21.0M, on 26 Jun 2026).
- Flags: the company's filings, on the day they were made (a 10-Q is the quarterly report and a 10-K the annual report; an 8-K reports a major event).
On file
All ORLY filingsLargest holders · 13F Q2 2026
Money flow| Filer | Position | Of fund |
|---|---|---|
| BlackRock | $6.0B | 0.1% |
| Vanguard Capital Management | $5.0B | 0.1% |
| State Street | $3.4B | 0.1% |
| Invesco | $2.5B | 0.2% |
| Geode Capital Management | $2.2B | 0.1% |
| Vanguard Portfolio Management | $1.5B | 0.1% |
| Morgan Stanley | $1.4B | 0.1% |
| FMR | $1.3B | 0.1% |
| Norges Bank | $1.3B | 0.1% |
| Bank of New York Mellon | $1.0B | 0.2% |
123 of the 815 filers we track · quarter ended Q2 2026 · positions, not flows
Insiders, last 24 months: 85 Form 4 filings; open-market trades net −$27.4M. Of the 50 on hand, 0 were open-market purchases and 8 sales — the rest are grants, option exercises and tax withholding.
Ask Orin about ORLY
Orin answers questions about ORLY from its filings, transcripts and numbers — with the source behind every claim. Your own desk starts with 3 free days, card required.
Start 3 free days →How is it priced, against its own past and its sector?
Priced at 28.3× its last 12 months of profit (Tue 27 Oct close) — higher than in 3 of its last 5 fiscal years (middle 24.0×); the typical Consumer Cyclical company on the NASDAQ is at 82.5×.
| Measure | Now | Its usual | Sector |
|---|---|---|---|
| P/E | 28.3×above usual | 24.0× | 82.5× |
| P/S | 3.91×above usual | 3.62× | — |
| EV/EBITDA | 19.6×above usual | 17.7× | — |
| P/B | below zero | — | — |
- P/B: below zero — it owes more than it owns on its books.
- "Its usual" is the middle of its own last 5 fiscal years.
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
P/S: the company's total market value divided by one year of revenue. Used when there is no profit to measure.
EV/EBITDA: the price of the whole company (its shares plus its debt, minus its cash) divided by one year of operating profit before interest, tax and write-downs.
P/B: the share price divided by the book value per share — what the company owns minus what it owes, as its accounts record it. When book value is tiny, P/B swings wildly and says little.
What do the analysts who cover it publish?
The analysts' average 12-month price target is $106 (from $94 to $115) — 18% above the Tue 27 Oct close price. That is their published opinion, not Orin's.
$106
$94 – $115 · +18% against the last close
- 14 buy or overweight
- 1 hold
- 0 underweight or sell
Price target: the share price an analyst publishes for about 12 months ahead. It is the opinion of the firm that wrote it; the average is across the firms that cover the company.
Overweight / underweight: analysts' rating words: overweight means the firm expects the stock to do better than the others it covers, underweight worse. Their words, not Orin's.
How is it priced next to the companies it is compared to?
Priced at 28.3× its last 12 months of profit. Only 2 of the 2 companies it is compared to made a profit (AZO 20.1×, GPC 468×), so there is no typical P/E.
| Company | Market value | P/E | EV/EBITDA | Gross margin | Net margin | ROE |
|---|---|---|---|---|---|---|
| ORLYO'Reilly Automotive, Inc. | $73B | 28.3× | 19.6× | 51.6% | 14.3% | n/m |
| AZOAutoZone, Inc. | $51B | 20.1× | 15.1× | 52.3% | 12.6% | n/m |
| GPCGenuine Parts Company | $17B | 468× | 30.9× | 36.4% | 0.1% | 1% |
- ORLY, AZO: return on equity is not meaningful (n/m) — book value is below zero.
- The list of companies is the data vendor's choice, so it can include a company a person would not have picked.
Market value: the share price times the number of shares — what the whole company is priced at.
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
EV/EBITDA: the price of the whole company (its shares plus its debt, minus its cash) divided by one year of operating profit before interest, tax and write-downs.
Gross margin: the share of each $1 of sales left after the direct cost of making what was sold.
Net margin: the share of each $1 of sales kept as profit after every cost. Below zero, the company lost money.
ROE: return on equity: one year of profit as a share of the shareholders' money in the business (its book value).
Is it priced high or low compared with its own past?
Priced at 28.3× its last 12 months of profit (Tue 27 Oct close). It has no full fiscal year on file since its history starts, so there is nothing of its own to compare with.
- Now28.3×
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
Fiscal year (FY): the company's own 12-month accounting year, which need not match the calendar year.
How has its sector been priced?
Consumer Cyclical companies on the NASDAQ were priced at a typical 82.5× their yearly profit (Tue 27 Oct close).
- Now82.5×
- Each year is the middle of that calendar year's daily sector P/E; "Now" is the Tue 27 Oct close figure, the same one in the table above.
Sector P/E: the middle P/E of the companies in the same sector on the same stock exchange, as the data vendor works it out each day.
What does a cash-flow model say a share is worth?
A standard cash-flow model puts it at $79 a share — 12% below the $89.89 price it was computed against (27 Oct).
| Model | Value a share | Against the price then |
|---|---|---|
| Standard | $79 | 12% below $89.89 |
| Levered | $83 | 8% below $89.89 |
Discounted cash flow: a model's estimate of what the company is worth today, from the cash it is forecast to make in future years. Small changes in the forecast move it a lot, and it says little about a company that loses money.
Standard / levered: two versions of the cash-flow model: the standard one counts the cash before the company pays its lenders, the levered one after.